India's UltraTech Cement expects another quarter of stymied growth (updated)

India Cements

19/07/2024 19:31

(Repeats with no changes to text)
    By Hritam Mukherjee
       BENGALURU, July 19 (Reuters) - UltraTech Cement
 ULTC.NS , India's No.1 cement maker, reported first-quarter
earnings below estimates on Friday, hurt by soft demand and
muted prices amid intensifying competition, and said growth
would pick up only next quarter.
    Cement prices were hovering around more-than-three-year lows
from April to June as attempts to raise prices were stymied by
soft demand and an aggressive fight for market share, analysts
said.
    Prices have softened sequentially in July and will likely
only start improving from October onwards, Atul Daga,
UltraTech's finance chief, said in a post-earnings call.
    The company's first-quarter profit and revenue both came
below analysts' average estimates, according to LSEG data.
    Its revenue growth of 2% was the slowest in at least five
quarters due to an election-linked slowdown in government
construction spending. Sales volumes increased 6%, on the lower
end of the 5%-11% band estimated by analysts.
UltraTech has been fighting to protect its market share,
especially from the billionaire Adani Group which has risen to
the No.2 spot in just two years via multiple big-ticket
acquisitions.
The Aditya Birla Group-backed UltraTech has taken the same
route, with its last deal being buying a 23% stake worth up to
$228 million in India Cements  ICMN.NS  last month.
    There was speculation UltraTech could increase its stake but
Daga, on Friday, said it "can't go beyond" that 23% stake.
UltraTech's shares ended 3.3% lower after the results.
($1 = 83.6425 Indian rupees)

(Reporting by Hritam Mukherjee in Bengaluru; Editing by Varun H
K and Savio D'Souza)
((mailto:Hritam.Mukherjee@thomsonreuters.com; X:
@MukherjeeHritam;))