The Ramco Cements Ltd. on Monday reported second-quarter standalone net profit jumped 40.2% to ₹236 crores on improved realizations following stable cement prices, improved sales of flagship and premium products in the trade segment.
Total revenue contracted to ₹1,265 crores (₹1,326 crores) following the lockdown and restricted access in containment zones and heavy rainfall in the Southern states. Sales during the period stood at 2.21 million tonnes against 2.72 million tonnes in the year-earlier period.
“The variable cost for the current quarter has come down due to lower fuel cost and improvement in blending ratio,” said A.V. Dharmakrishnan, CEO.
“The commencement of waste heat recovery system (WHRS) operations of 9 MW in Jayanthipuram in September and another 9 MW during the third quarter augurs well for further cost reduction in the coming quarters,” he added.
“The fuel procured in the earlier quarters have helped keep a check on the overall fuel cost during the current quarter, while the market prices of pet coke and coal have witnessed a sharp increase during this quarter,” he said.
During the six months period ended September 2020, During the quarter, the company spent has incurred ₹685 crores on its ongoing capacity and expansion program. It is planning to invest the balance of ₹881 crores towards capital expenditure in the coming months.
On ongoing projects, he said the company expects to commission the clinker unit of 1.5 MTPA along with 9 MW WHRS in Jayanthipuram and 2.25 MTPA clinkering unit in Kurnool before March 2021. The one-MTPA cement grinding facility, 12 MW of WHRS, and railway siding in Kurnool are expected to be commissioned in FY22.
Ramco Cements, which is planning to become a zero-debt company in three years, has reduced its borrowings by ₹104 crores after spending ₹685 crores on capital expenditure. The company’s gross debt as of September stands at ₹2,920 crores.