The Hindu : Business : India Cements turnover improves 21 % in H1

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Business

India Cements turnover improves 21 % in H1

Corporate Reporter

Significant rise in demand in southern region
Makes further progress in expansion

CHENNAI: India Cements could report a satisfactory performance in the half-year ended September 30, 2008, despite cost increases in power, fuel and coal. This was achieved through improvement in sales volume, selling prices and adoption of cost control measures.

Addressing presspersons here on Friday, V. Srinivasan, Chairman and Managing Director of the company, said the gross turnover for the first-half of the current financial year rose by 21 per cent to Rs. 2,083.43 crore from Rs. 1,723.93 crore in the year-ago period.

Higher provisions

The company was able to achieve a satisfactory growth in its earnings before interest depreciation and taxation (EBIDTA) at Rs. 610.42 crore against Rs. 573.75 crore. However, the net profit after tax was lower at Rs. 276.41 crore as compared to Rs. 406.05 crore in the year-ago period.

This was due to higher depreciation charges on account of higher capital expenditure incurred on shipping and IPL cricket franchise.

Also forex translation difference resulted in an exceptional expenditure of Rs. 51.30 crore against a gain of Rs. 13.49 crore in the same period in the previous year. Besides, the company had made a higher provision of Rs. 136.10 crore (Rs. 63.72 crore) towards income tax and fringe benefit tax, Mr. Srinivasan said.

The demand for cement continued to be brisk registering a growth of 8 per cent and the Southern region achieved a growth rate of 12.4 per cent with Andhra Pradesh particularly registering a significant 24 per cent in the first half of this year.

On-going projects

The new one million tonne grinding unit at Chennai had been completed and was in operation from the end of August. The upgradation of other units namely enhancement of Line-I capacity in Vishnupuram, addition of 1.2 million tonne capacity in Malkapur and an additional one million tonne grinding unit at Parli (Maharashtra) were progressing well, Mr. Srinivasan said.

Though work orders had been released for the new greenfield capacity of about 1.5 million tonnes in Rajasthan, there might be a slight delay due to some infrastructural bottlenecks.

The company is also putting up power plants of 20 MW each in Sankar Nagar and Dalavoi (Tamil Nadu).

Corrections and Clarifications

A report "India Cements turnover improves 21 % in H1" ("Business" page, November 1, 2008) made a reference, in the first paragraph, to Mr. V. Srinivasan being the Chairman and Managing Director of the company. It should have been Mr. N. Srinivasan, Vice-Chairman and Managing Director.

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