Kolkata, Feb 4 (UNI) Improvement in market conditions towards the end of the year helped Birla Corporation Ltd.

On Tuesday Birla Corporation reported a year-on-year sales growth of 7 percent by volume in the December quarter, while consolidated EBITDA for the quarter at Rs 263 crore represents a sequential growth of 36 percent.

The Company’s performance was led by the Chanderia unit, which benefited from higher traction in demand and prices in northern India.

In the core markets of central India, the Company retained its premium positioning despite increased competition.

The Mukutban plant of the Company’s subsidiary, RCCPL Pvt. Limited, registered a sequential volume growth of almost 20 percent and has established itself as one of the most efficient cement plants. It is now a significant contributor to the Company’s overall performance.

Along with its subsidiary RCCPL, Birla Corporation Limited now has a geographically well-balanced and distributed manufacturing footprint in northern and central India, which allows it to seamlessly service its addressable markets in northern, western, and central India, as planned under the Company’s long-term manufacturing strategy.

The Company’s consolidated cement sales by volume in the December quarter rose 7 percent to 4.5 million tons (mt) versus 4.2 mt in the same period a year ago, which represents a capacity utilization of 92 pc (85 pc last year).

Still, the Company’s realization from cement sales during the December quarter at Rs 4,781 per ton was 9.5 pc lower than last year because of lower prices in Maharashtra and central India. Nevertheless, it represents a sequential growth of 1.8 pc (Rs 4,697 per ton in the September quarter). Prices have started to firm up and improved realization is expected to support healthy growth in the quarters ahead.

While prices remained flat through October, cement manufacturers were able to raise prices on an average by Rs 3-5 per 50-kg bag only between end-November and December.

In the eastern and central markets, which are among the Company’s core markets, price rose by only Rs 2-3 per bag, against an average of Rs 4 for the rest of the country.

Despite sluggish demand, the Company managed to raise its share of sales of its high-yielding premium cement to 59 pc for the December quarter against 52 pc in the comparable period last year.

This represents a year-on-year growth of 19 pc in sales of premium products by volume to 1.8 mt, led by the Company’s flagship brand Perfect Plus, which registered a

robust 23 pc year-on-year growth in sales by volume.

The Company’s sustained focus on cost management across the board led to the overall variable cost of the Cement Division coming down by 8 pc year-on-year and by 1.9 pc sequentially.

Benign pet coke prices, combined with optimization of fuel mix, resulted in power

and fuel costs coming down 7.4 pc from the same period last year to Rs 1,072 per ton, while raw material costs were down 14 pc owing to dynamic management of the cost of inputs such as limestone, gypsum, fly ash, and slag.

The Cement Division’s EBITDA per ton for the December quarter at Rs 569 represents a sequential growth of 23.4 pc while being down 37 pc year-on-year.

The Division’s operating profit margin for the quarter was at 12 pc (17 pc a year ago) against 9.8 pc in the three months till September.

The Company has also been steadily scaling up the use of renewable power, which accounted for 26 pc of the total power consumed during the December quarter, against 25 pc in the previous quarter. In January, RCCPL’s Maihar unit agreed to source

from an external supplier 12 MW of wind-solar hybrid power. By the end of the current quarter, renewables will contribute almost 45 pc of Maihar’s total power needs.

Healthy rural demand, coupled with higher government spending, generated momentum in cement demand, which led to the Company raising prices in December.

The revised prices have sustained through January, while the cost environment remained benign.

Therefore, the Company remains optimistic about continued improvement in operations and profitability.

UNI PC BD