Birla Corp posts 207% pre-tax profit surge in Q3 amid muted demand scenario

Efforts to keep costs under check, higher capacity utilisation along with sales push of premium cement helped Birla Corporation log a whopping 207 per cent rise in Q3 pre-tax profit at Rs 129 crore. However, revenue went up a tad 10 per cent to Rs 1,715 crore, amid a muted demand scenario. 

Profit before tax and net income in the third quarter of the previous financial year stood at Rs 42 crore and Rs 1,557 crore, respectively. Net profit increased by 200 per cent to Rs 81 crore compared to Rs 27 crore on a year-on-year (YoY) basis.

Even as overall sales volume increased by seven per cent, sales of premium cement surged 17 per cent (by volume).

In the December quarter, share of premium cement in sales by volume through trade channels was 41 per cent compared to 37 per cent a year earlier.

Besides, the share of blended cement in total sales jumped from 89 per cent to 90 per cent. “Higher capacity utilisation, continued focus on trade sales, blended cement and premium products helped post healthy numbers. We also saved power and fuel costs as well as optimised logistics costs which yielded substantial savings,” said Sandip Ghose, COO at Birla Corporation.

Compared to the industry average of 70 per cent capacity utiliation, Birla Corporation registered 87 per cent utilisation for the December quarter, which is five per cent higher on a YoY basis.

Though prices remained weak in key markets in the December quarter, the company was able to garner higher market share in West Bengal and Bihar. This was by expanding distribution reach and leveraging cross-branding from multiple plants. Its sales in eastern India grew 27 per cent by volume over the previous year.

According to the company, during the December quarter, green shoots were visible in the infrastructure sector with demand in the non-trade segment growing faster than the trade segment.

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel