ACC Q2 Results: Profit Beats Estimates

The company reported a net profit of Rs 387.9 crore in the September quarter, compared to a net loss of Rs 87.3 crore.

<div class="paragraphs"><p>An ACC cement truck at its plant. (Photo: Company website)</p></div>
An ACC cement truck at its plant. (Photo: Company website)

ACC Ltd. reported a profit in the second quarter, beating analysts' estimates.

The Adani Group-owned cement manufacturer posted a net profit of Rs 387.9 crore in the September quarter, compared to a net loss of Rs 87.3 crore in the same period last year, according to an exchange filing on Thursday. Analysts polled by Bloomberg estimated a net profit of Rs 334.2 crore.

ACC Q2 FY24 Key Highlights (Consolidated, YoY)

  • Revenue up 11.22% at Rs 4,434.7 crore (Bloomberg estimate: Rs 4,403.5 crore)

  • Ebitda up 33.53 times at Rs 549.3 crore (Bloomberg estimate: Rs 575.5 crore)

  • Ebitda margin at 12.39% vs 0.41% (Bloomberg estimate: 13.1%)

  • Net profit of Rs 387.9 crore vs net loss of Rs 87.3 crore (Bloomberg estimate: Rs 334.2 crore)

The earnings growth was driven by lower input costs. Power and fuel costs declined 32.7% year-on-year to Rs 886.6 crore

The profit surge was also on account of a weak base, with the company posting loss in Q2 of FY23 for the first time in more than 15 years, on account of higher costs

The cement business' profit before tax grew to Rs 336.9 crore, compared to a loss of Rs 142.3 crore, while the ready-mix concrete earnings rose 78.6% to Rs 3.3 crore.

The rise in profit was also supported by volume growth of 17.4% year-on-year at 8.1 million tonne, driven by green blended cement portfolio accounting for 93% of total sales.

ACC commenced clinker production at its Integrated Ametha Unit, increasing overall clinker capacity by 3.3 million tonnes. In addition, a 16.3 MW waste heat recovery system is expected to be commissioned by Q3 at the Ametha facility.

Waste heat recovery system’s share improved to 9% from 2.9% and the total capacity is expected to increase to 46.3 MW in FY24. WHRS aids in reducing fuel consumption, carbon emissions and operating costs in a plant.

"This commendable growth is attributed to the improved demand for our premium cement products up by 1.5 pp YoY at 32% of trade sales, net dealer addition 534 during quarter across all markets, coupled with our commitment to enhancing operational efficiency and prioritising environmental sustainability," said Ajay Kapur, whole-time director and chief executive officer at ACC.

Shares of ACC jumped 1.15% from the day’s low to trade 0.02% higher at Rs 1,892.5 apiece at 2:07 p.m., after the results were announced, as compared with a 1.36% decline in the NSE Nifty 50 on Thursday.

Disclaimer: AMG Media Networks Ltd. (AMNL) currently owns a 49% stake in Quintillion Business Media Ltd. (QBML), the owner of BQ Prime Brand. AMNL has entered into an MOU to acquire the balance 51% stake in QBML. Post acquisition, QBML will become a wholly owned subsidiary of AMNL.