India's Ramco Cements posts Q2 profit plunge on muted prices, demand

Ramco Cements

11/11/2024 12:16

Nov 11 (Reuters) - India's Ramco Cements  TRCE.NS  posted a nearly 75% fall in second-quarter profit on
Monday, hurt by subdued demand in the monsoon season and falling prices.
    The company's net profit after tax for its standalone business, which comprises its cement segment, dropped
to 255.8 million rupees ($3 million) for the quarter ended Sept. 30 from 1.01 billion rupees a year earlier. 
    Revenue fell 12.5% to 20.38 billion rupees.
    For further results highlights, click  urn:newsml:reuters.com:*:nFWN3MI0DK
    
        KEY CONTEXT
  
    
Cement prices hit a five-year low in the September quarter, according to Ambit Capital, due to an industry-wide
ramp-up in production to meet medium-term demand expectations, leading to greater supply.
    Last month, market leader UltraTech Cement  ULTC.NS  posted its first quarterly revenue drop in four years
on lower cement prices, but flagged early signs of price recovery.
    Additionally, cement demand, already hit by a slowdown in construction in the quarter ended June 30 when
India voted in the general election, did not improve in the reported quarter, due to an above-average monsoon.
    
    PEER COMPARISON   
    
                                  Valuation     Estimates (next 12   Analysts' sentiment                 
                                   (next 12           months)                                            
                                   months)                                                               
                    RIC         PE      EV/EBI  Revenue   Profit     Mean      No of     Stock to price  Div
                                        TDA     growth    growth     rating*   analysts  target**        yield
                                                (%)       (%)                                            (%)
 JK Lakshmi Cement   JKLC.NS     18.84    8.91    8.91      14.37    Hold            11       0.93         0.80
 India Cements       ICMN.NS    128.78   25.12    4.98      NULL     Sell             5       1.44         0.00
 Ramco Cements       TRCE.NS     39.22   13.78    8.28      31.97    Hold            19       1.01         0.28
 Nuvoco Vistas       NUVO.NS     51.50   10.06    4.89     103.90    Hold            15       0.96       NULL
 Corporation                                                                                             
    
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is
trading above the PT


JULY-SEPTEMBER STOCK PERFORMANCE    
        
  
    -- All data from LSEG
    -- $1 = 84.3570  Indian rupees

    

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 (Reporting by Aleef Jahan and Dimpal Gulwani; Editing by Sumana Nandy and Janane Venkatraman)
 ((aleefjahan.cs@thomsonreuters.com))