India Cements’ quarterly profits slip 30% year-on-year

India Cements’ quarterly profits slip 30% year-on-yearThe India Cements Ltd, South India's leading cement producer, pocketed a net profit of Rs 49.08 crore in seconded quarter of current fiscal, but the figure represents a decline of 30 per cent from a net profit of Rs 69.71 crore that the company had reported in the corresponding period of previous fiscal.

The cement producer held increased input costs responsible for the decline in the quarterly net profit. The power and fuel costs of the company jumped 21 per cent during the three months ended September 30 to Rs 328.48 crore.

N Srinivasan, vice chairman and managing director of India Cements, said, "Our profits were lower as we suffered from increased input costs due to power and fuel. We got slaughtered because of power costs."

The combination of lower realization and rise in power cost dragged the company's Ebitda margin down to 18.3 per cent. Analysts had projected Ebitda margin of 22 per cent for the company.

The rises in power tariff in Tamil Nadu and Andhra Pradesh by the states' electricity boards hiked the input costs further.

However, some domestic brokerages like Motilal Oswal expect power costs to come down as shipments from Indonesian coal mines will likely take place by the January-March quarter.

Following the announcement of quarterly results, stock in the India Cements Ltd slipped marginally and ended trading at Rs 97.55 apiece on the Bombay Stock Exchange (BSE).