Ambuja Cements PAT up 23% at Rs 404 cr

MUMBAI: Buoyed by a higher prices and sales, Ambuja Cements (formerly, Gujarat Ambjua Cements) has recorded a 23% rise in profit after tax to Rs 403.57 cr for the quarter ended June, against Rs 327.40 crore in the year-ago period. Ambuja Cements is India's third largest cement maker. Net sales for the quarter rose 11% to Rs 1,464 crore (Rs 1,314 crore).

Net profit, after factoring in other items, has more than doubled due to the sale of Mumbai land to reality firm Orbit Corporation for 255.36 crore, and sale of its stake in Ambuja Cement India, to Holderind Investment, the investment arm of Holcim, for Rs 240.75 crore. These extra-ordinary and non-recurring gains pushed ACL net profit during the quarter to Rs 878 crore. Holcim holds 30% in Ambuja Cement.

The scrip, however, fell 2.1% to close at Rs 135.90. Total expenditure has gone up to Rs 919.05 crore during the quarter from Rs 798.16 crore during the same quarter in the previous year due to higher fuel and freight cost among other things.

Cement firms have been registering strong earnings for the last two years on the back of an investment boom in the Indian economy and an increased construction activity. Industry analysts expect cement prices to rise after the monsoon as most regions are facing a shortage.

Cement prices were stable during the first quarter of the current fiscal in all regions except the south where prices were around 7% more than the previous year's.

ACL said in a statement the company has capital expenditure plans for around Rs 3,500 crore during the next two to three years for augmenting its cement capacity by another 6 million tonnes. ACL has a capacity of 15 million tonnes. During the quarter, ACL has commissioned the first phase of the 30 mw thermal power plant at Ambujanagar in Gujarat and also commissioned its new 1 million-tonne cement grinding unit at Farakka in West Bengal.