Ambuja Cement Q3FY24 net profit soars 123% YoY to Rs 1090 cr

The company's consolidated revenue from operations saw a 2.8 percent increase, reaching Rs 8,128.80 crore. On a sequential basis, there was a 9.4 percent rise in revenue and a substantial 10.4 percent increase in profit.

On a standalone basis, the profit showed a notable 39 percent rise, amounting to Rs 513.68 crore, while revenue experienced a 7 percent jump to Rs 4,439.52 crore.

"The Cement Industry is expected to have a demand growth between 7% and 8% because of investments in infrastructure and real estate projects," the company said in a statement.

"Higher consumption of domestic coal helped in improving coal cost and the trend is expected to continue. The opportunity to buy low-cost petcoke in the past few weeks will help to further optimise fuel costs in the coming quarters and this augurs well in our cost optimisation journey," Ambuja added.

The company highlighted that a competitive mix of kiln fuel and Alternative Fuels and Raw materials (AFR) volume contributed significantly to a 25% reduction in fuel costs.

In the quarter, the cement maker disclosed an EBITDA margin of 21.3%, marking its "highest in the last 10 quarters." Further, the operating EBITDA for Q3 witnessed a substantial 70% increase, reaching Rs 1,732 crore.

“India’s per capita consumption of 272 kg as compared to the global average of nearly 550 kg provides a sizeable potential for expansion of the cement industry,” the company said.

Ambuja has lined up massive investments in green power (WHRS, Solar, Wind), AFR handling, railway infrastructure and fly ash handling systems amongst others. These are expected to result in sizeable improvement in profitability/EBITDA and returns to stakeholders.

In December 2023, Ambuja Cements successfully completed the acquisition of Sanghi Industries having a 6.1 MTPA capacity. This month, Ambuja’s subsidiary ACC completed the acquisition of the balance 55% stake in Asian Concretes and Cements Private Ltd (ACCPL) having 2.8 MTPA capacity.

“These acquisitions reinforce the Adani Group’s market leadership and take its cement capacity to 77.4 MTPA, a jump of 15% from last year.  Integration of these acquired companies is going on well,” said the company.

There is an ongoing cement capacity expansion of 20 MTPA at various stages. The board has also approved additional Cement capacity expansion of 12 MTPA, which outlines a road map for 110 MTPA (80% of 140 MTPA capacity targeted by FY 2028)

Ongoing green power projects of capex of 10,000 crores will take green power share to 60% of expanded capacity while reducing operating costs.