ACC consolidated profit grows 105% to ₹466 cr in Q1

Cement major ACC Ltd, a subsidiary of Adani Group, released the financial results for the April to June period of FY24 on July 27. The consolidated net profit of the cement manufacturer surged as much as 105.07% to ₹466.14 crore in Q1 of FY24 as against ₹227.35 crore in the same period last year. Sequentially, the profit grew 97.8% as against ₹235.66 crore in the Q4 of FY24.

During the quarter under review, the company's revenue from operations stood at ₹5,201.11 crore, up 16.4% as against ₹4,468.42 crore in Q1 of FY23. Sequentially, the revenue grew by 8.5% as against 4,790.91 crore in the January to March period of FY23.

During the quarter under review, the company’s total income grew by 16.7% year-on-year at ₹5,278.02 crore, as against ₹4,522.28 crore in the same period last year. Sequentially, the total income of ACC Ltd grew by 7.49% as against ₹4,910.06 crore in Q4 of FY23.

The company's EBITDA (earnings before interest, tax, depreciation and amortization) stood at ₹848 crore, up 76.6% as against ₹480 crore in the same period last year. The EBITDA margin stood at 16.3% as against 10.7% in Q1 of FY23. The EBIT margin stood at 12.5% against 7.1% in April to June quarter of FY23.

"The growth was driven by robust demand for high-quality cement products across all markets, as well as our continuous efforts to optimize operations and reduce environmental impact," says Ajay Kapur, CEO, ACC Limited.

"Our long-term competitiveness remains robust, ensuring industry-leading profitability even as we chase our ambitious growth goals. With a firm belief in strategic approach, we are poised to continue our trajectory of outstanding performance in the forthcoming quarters," he adds.

The company says in its outlook that the cement industry is in a positive cycle of demand as well as cost factors. "This is coming at the most appropriate time when the company is under the transformation phase, buoyed by synergies with the group. We expect the positive trend of the industry to continue in the coming quarter," says the company.

Shares of ACC Ltd closed at 0.86% higher at ₹1,938.65 on the BSE. The market capitalisation of the Adani Group subsidiary stood at ₹36,405.38 crore as 36,752 shares exchanged hands on the BSE as against the two-week average of 0.23 lakh shares.

Rating agency Moody's Investors Service expects the country's cement production will climb by around 6%-8% over fiscal years 2023 and 2024, following a 21% jump for the fiscal year ended March 2022.

"A growing housing sector, which typically accounts for 60%-65% of India's cement consumption, will remain a key demand driver. Also, continued large investments in roads and infrastructure projects will fuel cement demand," Moody's says.