Here are the Q2 estimates for Cement Industry as it is expected to give poor results

Published 13-10-2022, 01:35 pm
© Reuters.  Here are the Q2 estimates for Cement Industry as it is expected to give poor results
HOLN
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ACC
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ABUJ
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The Indian cement industry started witnessing consolidation from the second quarter (June to September 2022) of the current fiscal year. The wave was created by the ports-to-power conglomerate the Adani (NS:APSE) Group acquiring Ambuja Cements (NS:ABUJ) and ACC from the Holcim (SIX:HOLN) Group for $6.5 billion.

In his next big act, Gautam Adani is eying the purchase of the cement assets of the debt-laden Jaypee Group at an enterprise valuation of Rs. 5,000 crores. In another move, Sajjan Jindal-owned JSW Cement purchased a limestone mine and land in Madhya Pradesh from India Cements (NS:ICMN). RK Damani-owned India Cements is a cement producer primarily located in Southern India.

All these developments come on the back of huge capital expenditure plans leading cement manufacturers of India have announced including Aditya Birla Group-controlled UltraTech, JSW Cement, and India Cements.

However, amidst all this news, KR Choksey’s report on the cement sector projects a mixed short-term outlook. The brokerage firm estimates cement producers to report a decline in profits for the July to September quarter of the present financial year.

The brokerage house has provided the following estimates on cement manufacturers for Q2FY23:

UltraTech Cement Ltd (NS:ULTC).

● Net profit is projected to decline 19.2% year-on-year (Y-o-Y) and decrease 33% quarter-on-quarter (Q-o-Q) to Rs. 1,060.8 crores.

● Net sales are estimated to increase 13.7% Y-o-Y but drop 9.9% Q-o-Q to Rs. 13,665.3 crores.

ACC Ltd (NS:ACC).

● Net profit is projected to decline 47.6% year-on-year (Y-o-Y) but increase 3.8% quarter-on-quarter (Q-o-Q) to Rs. 236 crores.

● Net sales are estimated to increase by 13.1% Y-o-Y but fall 5.1% Q-o-Q to Rs. 4,241.2 crores.

Ramco Cements (NS:TRCE) Ltd.

● Net profit is projected to decline sharply by 65.4% year-on-year (Y-o-Y) and 32.9% quarter-on-quarter (Q-o-Q) to Rs. 73.2 crores.

● Net sales are estimated to increase by 10.9% Y-o-Y but fall 6.3% Q-o-Q to Rs. 1,667.2 crores.

Shree Cement (NS:SHCM) Ltd.

● Net profit is projected to drop 48.2% year-on-year (Y-o-Y) but increase 4.4% quarter-on-quarter (Q-o-Q) to Rs. 291.8 crores.

● Net sales are estimated to increase by 12.7% Y-o-Y but decrease by 13.9% Q-o-Q to Rs. 3,801.2 crores.

Written By – Vikalp Mishra

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