NEW DELHI: India Cements has taken a host of measures to tide over the impact caused by the Covid-19 crisis, which in turn helped the company to report an impressive performance for the quarter ended December 2020. For Q3 FY21, the company has posted a net profit of Rs 62.02 crore, as against a net loss of Rs 5.37 crore in the year ago quarter. EBITDA margin — a measure of a company’s operating profit as a percentage of its revenue — was at 19 per cent as against 11 per cent the previous year.
During the quarter, the pro-active steps the company initiated to help stay profitable includes fixed cost control without laying off employees, implementing cash and carry model in sales of cement and fixing a price below which the company refused to sell, said N Srinivasan, vice-chairman and managing director of the company. “We were not bothered what others (cement manufacturers) did. Our volumes came down a little, but profitability was sustained, so was the business,” Srinivasan added.
The overall volume of clinker and cement fell 11 per cent at 23.77 lakh tonnes as against 26.66 lakh tonnes in the year-ago period. Revenue was lower at Rs 1,160 crore (Rs 1,191 crore), while total expenses dropped to Rs 1,074 crore from Rs 1,205 crore a year ago, the company said in a regulatory filing.
Srinivasan said the demand for cement was high in the northern and central parts of the country while it was a double-digit growth in eastern parts. However, demand was subdued in the southern states.
On capital expenditure plans, he said that the proposal to set up a plant in Madhya Pradesh, entailing investments of about Rs 1,400 crore, would be delayed due to the pandemic. In November 2018, India Cements had signed a share purchase agreement with Springway Mining for this purpose.