Mumbai: Cement maker ACC Ltd on Friday said its net profit fell 45% in the fourth quarter as sales volumes declined despite a continued thrust on promotions.
ACC, which reported a decline in net profit in seven of the last eight quarters, said consolidated net profit fell to Rs56.34 crore in the quarter ended 31 December from Rs102.39 crore a year earlier. The company follows a January-December financial year.
Consolidated net sales fell 6.1% to Rs2,671.61 crore from Rs2,846.11 crore a year earlier.
The results also missed Street estimates. Four analysts polled by Bloomberg had expected ACC to report consolidated net profit of Rs98.225 crore on sales of Rs2,720.3 crore.
The slowdown witnessed after demonetisation is easing and we expect the economy to show solid growth in the months to come, the company said in a statement.
“Increased government spending on infrastructure development, housing, roads, railways, irrigation and other schemes as announced in the recent Union Budget are expected to further reinvigorate the construction sector soon and boost demand for cement and concrete during 2017,” the company said.
Sales volume during the quarter was lower at 5.45 million tonnes, compared with 6 million tonnes a year earlier. Sales in ACC’s largest cement business fell 7.6% to Rs2,505.42 crore, while those in its ready mix concrete business rose 14.4% to Rs282.92 crore.
The company, however, said continued thrust on promotion of its range of premium products, comprising high performance varieties that come coupled with services, yielded an increase of about 27% in the sales of these products in the full-year ended 31 December.
The Indian cement industry is estimated to have a capacity of about 420 million tonnes. ACC, Ambuja Cement Ltd, UltraTech Ltd and Dalmia Cement Ltd command about 40% of this market.