CHENNAI, AUG 7
The India Cements Ltd (ICL) on Monday reported a standalone net loss of ₹75.27 crore in the first quarter of FY24 as compared to a net profit of ₹76.09 crore in the same period last year. Loss in the reporting quarter was attributed to reduction in selling price, loss of volume and high variable cost.
Speaking to reporters, Vice Chairman and Managing Director N Srinivasan noted that the company requires about ₹ 400 crore – ₹ 250 crore for capital expenditure and ₹ 150 crore for working capital – and about ₹ 100 crore will be raised in two weeks towards working capital.
- It had posted a net profit of ₹76 crore in the year-earlier period
- The company requires about ₹ 400 crore – ₹ 250 crore for capital expenditure and ₹ 150 crore for working capital: Vice Chairman and Managing Director N Srinivasan
For the remaining funds, India Cements will monetise its non-core assets.
The company’s revenue from operations during Q1FY24 declined 3.7% to ₹1,393.04 crore from ₹1,446.23 crore, YoY.
Operating performance in the June quarter weakened as earnings before interest, taxes, depreciation and amortization (EBITDA) decreased 83.7% to ₹5 crore from ₹30.9 crore, while EBITDA margin compressed by 170 basis points (bps) to 0.4% from 2.1%, YoY.
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India Cements is primarily engaged in manufacture and marketing of cement and cement related products.
The cement sales for the quarter under review was only 26.57 lakh tons as compared to 27.85 lakhs tons in the previous quarter.
The low sales was only due to the liquidity crunch faced by the company consequent to lower margins and losses.
With a view to address the profitability and liquidity concerns, the company has initiated steps to modernise some of its plants to improve the operating efficiencies.
“The Company has also engaged the services of management consultants to study the operations in its plants and suggest measures to reduce the variable costs. In addition to the above the company has also plans to infuse funds from sale of non-core assets and mobilise additional resources to improve the operations including sales volume. The company has engaged Boston Consulting Group to study the operations at three of its plants in Andhra Pradesh and suggest measures for improving efficiency in operations of these plants,” Srinivasan said.
India Cements, it has been improving its performance progressively over the last four quarters. The variable cost has been reducing over the period. There has been a reduction of ₹ 168 per ton in variable cost during the quarter under review as opposed to the last quarter of previous year, he added.
