UltraTech Cement Ltd, a leading company of the Aditya Birla Group, reported a consolidated net profit of Rs 825.18 crore for the second quarter (Q2) of the fiscal year 2024-25. This marks a significant decrease from the Rs 1,280.38 crore net profit posted in the same quarter last year, according to the company's regulatory filing. The company clocked a 36 per cent fall in net profit in Q2 on account of lower revenue from operations.
The company’s revenue from operations stood at Rs 15,634.73 crore for the July-September quarter, down from Rs 16,012.13 crore in the corresponding period of the previous year. Total expenses for the quarter amounted to Rs 14,837.44 crore.
UltraTech noted that its consolidated financial results are "not comparable" due to the acquisition of an additional stake, raising its holding to 54.79 per cent in Ras Al Khaimah Co. for White Cement & Construction Materials PSC (RAKW), a UAE-based company. As a result, RAKW became a subsidiary of UltraTech Cement Middle East Investments Ltd (UCMEIL) effective from July 10, 2024, and its financial results are now included in the consolidated figures from that date.
On a standalone basis, UltraTech’s net profit from the domestic market fell by 34.71 per cent to Rs 796.89 crore in the September quarter, with revenue down 3.68 per cent at Rs 14,905.23 crore. This decline in revenue comes despite a 3 per cent year-on-year growth in domestic sales volume of grey cement, reaching 25.75 million tonnes (MT), amid persistent rainfall across the country.
"UltraTech achieved capacity utilisation of 68 per cent during the quarter," the company said, noting that the overall sales realization decreased by 8.4 per cent year-on-year and 2.9 per cent quarter-on-quarter, reflecting industry-wide price challenges.
UltraTech's energy costs were down by 14 per cent YoY, while raw material costs increased by 1 per cent due to higher prices for fly ash and slag. On a consolidated basis, the company’s sales volume reached 27.84 MT, with 26.42 MT coming from its Indian operations and 1.66 MT from overseas units.
The company continues to expand its operations, adding 9.9 MT of grey cement capacity by October this fiscal year, bringing its total installed capacity to 146.2 MT by the end of FY24. UltraTech is awaiting regulatory approval for additional capacity from Kesoram Cement and India Cements, totaling 25.2 MT.
The company faces stiff competition from Ambuja Cements, led by billionaire Gautam Adani, which is also expanding aggressively through acquisitions and brownfield projects.
UltraTech's ongoing capacity expansion projects are part of a larger effort that could see its total cement capacity surpass 200 MT by FY27. This growth includes the anticipated acquisitions of Kesoram Cement and India Cements.
Looking ahead, UltraTech said it remains aligned with India’s broader growth trajectory. With increased government spending on infrastructure and rising demand in the urban housing sector, the company expects sustainable volume growth of 7-8 per cent in the coming years.
At the close of trading, UltraTech Cement shares were down 2 per cent at Rs 10,840 apiece on the BSE.