India Cements shares gain 3% as losses narrow in Q2

Shares of India Cements gained 3.2 percent in early trade on November 2 as the cement player’s losses narrowed in the September quarter at Rs 81 crore against Rs 137.6 crore in the year-ago period.

India Cements‘ revenue slipped 4.62 percent to Rs 1,264.39 crore from a year ago.

Nuvama Institutional Equities said the loss of volume and overall cost impacted the bottom line. Volumes came in at 2.37MT (down 11 percent sequentially), while overall cost came down 14 percent YoY.

The sales volumes were constrained as the company faced a liquidity crunch on losses and lower margins. On a positive note, fuel costs declined, and the management expects the benefit will continue until the end of the upcoming quarter.

The management is expecting volumes to grow to 5.5MT in the second half of the fiscal over 5.04 MT in H1FY24.

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The management is set to undertake a capex of Rs 3,500 crores over FY24/25 with the focus on improving cost efficiencies. This shall be directed towards grinding (changing roller mills in some plants), changing the pyro processing technique in some plants, and more operational upgrades, the company said.

India Cements expects to generate Rs 100 crore through the sale of 80–90 acres of land parcels to fund this capex.

At 9.50 am, India Cements was trading at Rs 204.85 on the NSE, higher by 2.53 percent from the previous session’s closing price.

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