Ambuja Cement posts 39% surge in Q3 profit at Rs 514 crore, revenue at Rs 4,439 crore

Ambuja Cements Q3: Adani Group-owned Ambuja Cements posted a 39.2 per cent increase in year-on-year (YoY) profit at Rs 513.7 crore for the quarter ended December 2023.  The company reported a revenue of Rs 4,439.5 crore, surpassing the anticipated Rs 4,399 crore, and marking a 7.5 per cent increase from the Q3 FY'23 revenue of Rs 4,128.5 crore.

EBITDA growth

The company's earnings before interest, taxes, depreciation and amortisation (EBITDA) for Q3 FY24 stood at Rs 850 crore, showcasing a remarkable 33 per cent increase from the previous year, making it the highest in the last 10 quarters.

Margin expansion

The operating margin for Q3 FY24 reached 19.2 per cent, a substantial improvement from the 15.2 per cent reported in Q3 FY'23, indicating a 400 basis points increase.

Capacity expansion and acquisitions

Ambuja Cement has completed the acquisition of Sanghi Industries, adding 6.1 MTPA capacity. Additionally, ACC, Ambuja's subsidiary, acquired the remaining 55 per cent stake in Asian Concretes and Cements Private Ltd, bringing its cement capacity to 77.4 MTPA, a 15 per cent increase from the previous year.

Ongoing green power projects with a capital expenditure of Rs 10,000 crore will increase the share of green power to 60 per cent of expanded capacity, contributing to reduced operating costs.

Financial strength and efficiency measures

The EBITDA (PMT) surged to Rs 1,225, a significant increase of Rs 481 from last year's Rs 744, marking the highest in the last 10 quarters.

The EBITDA margin reached an impressive 21.3 per cent, showcasing an 8.4 percentage point increase and standing as the highest among the peer group.

Earnings Per Share (EPS) (diluted) witnessed a YoY increase of Rs 1.84, reaching Rs 3.86 in Q3 FY'24. For the nine months ending Dec'23, the EPS was Rs 11.90, up Rs 5.62 YoY.

Future growth and financial health

The company's Cash and Cash Equivalent stands at an industry-leading Rs 8,591 crore, reflecting financial strength and liquidity. Ambuja Cement is on track for cement capacity expansion, with 32 MTPA additional capacity under implementation, taking the total capacity to 110 MTPA, 80 per cent of the targeted 140 MTPA by FY 2028. Ongoing efficiency improvement projects have led to a reduction in Total Cost PMT by Rs 491 on a consolidated basis, with additional savings expected in the future.

Ajay Kapur, Whole Time Director & CEO, Ambuja Cements Limited, said, "Our performance is a reflection of our resilience and focused efforts. Our pursuit of excellence continues to propel us towards setting new benchmarks in our steady growth.  We remain steadfast in our mission to deliver value for all stakeholders by redefining the industry landscape.”

The shares of Ambuja Cement dipped 4.17 per cent to Rs 547 apiece on the NSE after the results were announced.