Displaying items by tag: Monsoon

India: UltraTech Cement's consolidated sales were US$3.51bn during the first half of the 2023 financial year, which began on 1 April 2022, up by 22% from US$2.88bn in the first half of the 2022 financial year. Its net profit was US$283m, down by 22% year-on-year from US$363m. This was due to a 32% cost rise to US$3.13bn from US$2.38bn. Power and fuel contributed 32% of costs at US$1bn, up by 68% from US$598m in the first half of the 2021 financial year.

UltraTech Cement said that it began to see signs of cement demand revival in September 2022, following traditionally subdued second-quarter demand due to seasonal rains.

India: Axis Bank subsidiary Axis Securities has predicted a 4 – 6% year-on-year drop in Indian cement sales volumes during the third quarter of the 2022 financial year, which ended on 31 December 2021. The Hindu newspaper has reported the reasons for the predicted drop as extended monsoons, especially in the south of the country, and a construction ban in the National Capital Region due to pollution. Monthly sales grew slightly year-on-year in December 2021.

Axis Securities has also forecast a revival of demand in the fourth-quarter, driven by infrastructure and housing projects. Overall, it expects national demand for cement to grow by 8 – 9% in the 2022 financial year.

India: Cement sales in September 2011 showed signs of a revival with monsoon weather subsiding in most parts of the country. However the ongoing unrest over the creation of a new state in Telangana have affected the despatches of ACC. In addition UltraTech Cement, one of the biggest producers in the country, has not yet announced its figures for the month.

Cement demand from the real estate sector has improved with many builders putting their projects on fast track to keep up their promise of timely delivery during the festival season. But there are no substantial developments in the infrastructure sector even as some government projects have been announced.

Analysts warn that it's too early to predict a recovery in cement demand because there is no marked improvement in the economic health of the country along with continuing unstable global developments from the US and Eurozone. With concern over rising input costs and increases in lending rates still lingering, cement companies have kept their production in check in order to align with the demand.

Besides transportation interruptions, the Telangana disruption has paralysed power supplies. Big cement factories have captive power plants but smaller cement units have been badly affected. The supply of coal from Andhra Pradesh was also hit, pushing up the cost of power production for captive plants that had to rely to a large extent on imported coal shipments.

V Srinivasan, a research analyst at Angel Broking, said that cement companies are expected to face margin pressures due to higher fuel costs because of increased domestic and international coal prices. The demand revival has helped cement companies to raise prices across the country, yet despite the rise, cement producers' profitability may be under pressure due to increasing costs.