- 10 Nov 2023
- ICICI Securities
OPERATIONAL PERFORMANCE IMPROVES SHARPLY ON STRONG VOLUME GROWTH AND LOWER COST
RAMCOCEM - 1063 Change: 7.75 (0.73 %)News: Revenue increased by 30.5% YoY (+4.2% QoQ) to Rs 2340.6 crore, mainly led by 37.6% YoY (+7.2% QoQ) growth in cement sales volumes to 4.61 million tonnes (mtpa). Blended realisation at Rs 5077/ton was down by 5.2% YoY (-2.8% QoQ) as cement prices remained lower in south region. EBITDA increased sharply by 116.1% YoY (+18.1% QoQ) to Rs 405.6 crore as margin improved substantially on lower power & fuel cost and positive operating leverage. EBITDA/ton was up sharply to Rs 880/ton vs Rs 560/ton in Q2FY23. Thus, on account of strong revenue growth and margins improvement, profitability improved significantly. PAT came at Rs 72.0 crore as against Rs 3.7 crore in Q2FY23. H1FY24 revenue growth stands at 28.4% YoY with 33.8% YoY volume growth. EBITDA/ton for H1FY24 stands at Rs 841/ton vs Rs 737/ton in H1FY23.
Views: Operational performance for the quarter was better than expectation on account of better-than-expected volume growth. Company continues to show industry-superior volume growth led by timely capacity additions. EBITDA/ton improved sharply on YoY basis led by lower fuel prices, positive operating leverage and operational efficiency measures like increasing usage of alternative power. Going ahead, operating margins are expected to improve further in coming quarters considering the increase in cement prices from Oct 2023 and lower fuel prices.
Impact: Positive