Ambuja Cements Q2 net jumps multi-fold to ₹987 cr on lower cost, better realization

• The company, now part of the Adani Group, had clocked a net profit of ₹ 51.30 crore in the July-September quarter a year-ago
• Revenue grew by 4.1% @ Rs 7,424 Cr.
• EBITDA stood at Rs 1,302 Cr (up by Rs 975 Cr), driven by operational excellence and cost saving projects
• EBITDA margin expanded by 12.9 pp from 4.6% to 17.5%.
• Clinker & Cement sales volume growth of 2.3% YoY at 13.1 Mn T
• Kiln Fuel cost reduced by 34%, (Rs 2.72/’000 kCal to Rs 1.79/’000 kCal) expected to further come down through mix and source optimisation
• WHRS power mix has gone up by 11.2 pp to 15%

NE BUSINESS BUREAU

AHMEDABAD, NOV 1

Ambuja Cements, the cement and building material flagship company of the diversified Adani Group has reported that its net profit in the September quarter was up multi-fold to ₹987 crore against ₹51 crore logged in the same period last year.

Income increased 9 per cent to ₹7,900 crore (₹7,241 crore).

Overall expenses were lower at ₹6,564 crore (₹7,176 crore) on the back of fall in power and fuel at ₹1,863 crore (₹2,734 crore) and freight cost at ₹1,800 crore (₹1,823 crore).

Power cost was lower due to use of alternative fuel resulting in klin fuel cost reduction to ₹1.82 per 1,000 kCal from ₹2.94. The company is planning to reduce freight and forwarding cost by ₹150 per tonne by route optimisation. Unified organisation structure has helped the company bring down other expenses by 11 per cent to ₹830 per tonne from ₹931.

EBITDA grew nearly four times to ₹1,302 crore (₹327 crore). EBITDA per tonne was up at ₹995 (₹1,082). Waste Heat Recovery System power mix has gone up 11.2 percentage points to 15 per cent.

Sales volume grew 2 per cent to 13 million tonne.

The company’s cash reserves were at ₹11,721 crore in September quarter (₹7,267 crore).

The company expects to complete the ₹5,000-crore acquisition of Sanghi Industries by December quarter as part of its plan to increase capacity to 140 million tonne by 2028.

Ajay Kapur, Whole-Time Director & CEO, Ambuja Cements, said, “Along with strong demand for our premium cement products, the business performance improved due to operational excellence; supply chain management and adjacencies benefits with group companies have lowered input costs and boosted margin growth..”

Logistics efficiencies has resulted in direct dispatch to 58 per cent from 48 per cent.

Apart from ordering new equipment, civil work has started for the 4-mtpa cement plant at Bhatapara in Chhattisgarh and is expected to be completed by Q2 FY26. Similarly, order has been placed on EPC vendor and piling work has started for grinding unit at Sankrail and Farakka in West Bengal, and is expected to be completed by Q3 FY25.

Ajay Kapur, Whole Time Director & CEO, Ambuja Cements said, “Continuing our transformation journey, we are pleased to report a strong performance (standalone) in the second quarter of FY‘24, with a 8% increase in revenue, 147% increase in EBITDA at Rs 773 Cr and 364% increase in PAT at Rs 644 Cr compared to the previous year same quarter. Along with strong demand for our premium cement products, our business performance improved due to operational excellence, supply chain management and sales & marketing excellence, Adjacencies benefits with Group companies are lowering input costs which is boosting EBITDA & Margin growth.”