Covid-19 impact: UltraTech Cement restricts FY21 capex to Rs 1,000 cr

The company further noted that work on the 2.2 million ton Cuttack grinding unit, in Odisha, which was scheduled for commissioning in March, 2021 has been slowed down.

UltraTech Cement has restricted its capital expenditure plans for this fiscal to Rs 1,000 crore due to Covid-19 disruptions, as conserving its cash position has become the "biggest motto" for the company this year.

In a regulatory filing, the Aditya Birla Group firm said the capital and financial resources of the company remain entirely protected in spite of the adverse impact on its sales during the first two phases of the lockdown and the liquidity position remains "adequately covered".

"Due to Covid-19, capital expenditure (Capex) plans for the current financial year have been restricted to an amount of around Rs 1,000 crore, said UltraTech in a disclosure of material impact of Covid-19 pandemic.

It is continuously monitoring any material changes in future economic conditions.

"The company's capital and financial resources remain entirely protected in spite of the adverse impact on its sales during the first two phases of the lockdown. The company's liquidity position remains adequately covered.

"During the lockdown period also, the company has been servicing its debt obligations as per schedule and on due dates," it said, adding it doesn't not require to avail the moratorium extended by banks as per the Reserve Bank of India guidelines.

"Conserving cash is the biggest motto for the company this year. The company is carrying sufficient inventories across all its plants to meet the production requirements," it said.

 

The company further noted that work on the 2.2 million ton Cuttack grinding unit, in Odisha, which was scheduled for commissioning in March, 2021 has been slowed down.

"Brownfield capacity expansion work at the West Bengal and Bihar grinding units and Bicharpur coal block (in Madhya Pradesh) is coming to an end and should get commissioned by March, 2021," it added.

During the lockdown, UltraTech has stopped its operations across locations in line with the government directives. "This had an adverse impact on revenues, as expected," the company said.

On impact on capital and financial resources, UltraTech said it "expects to recover the carrying amount of all its assets including inventory, receivables and loans in the ordinary course of business based on information available on current economic conditions".

UltraTech Cement had reported a consolidated net profit of Rs 3,239.39 crore in the fourth quarter ended March, 2020. Its revenue from operation was Rs 10,745.62 crore during the quarter.



Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

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