Shree Cement Ltd, a key player in India’s cement industry and part of the Bangur family conglomerate, reported a substantial decline in its consolidated net profit for the first quarter of FY25. For the period ending June 2024, the company’s net profit fell by 51.31% to Rs 278.45 crore, down from Rs 571.94 crore in the same quarter of the previous fiscal year.
Despite this significant dip in profitability, Shree Cement’s revenue from operations showed a modest increase of 1.73%. The company posted revenue of Rs 5,123.96 crore during the quarter, compared to Rs 5,036.65 crore in the corresponding period last year. This increase in revenue was accompanied by a 10.05% rise in total expenses, which reached Rs 4,957.24 crore. The company’s performance was notably impacted by sluggish market demand, a challenge exacerbated by factors such as the general elections and adverse weather conditions. Shree Cement’s total sale volume increased by 8%, climbing from 8.92 million tonnes to 9.64 million tonnes. Additionally, the sale of premium products constituted 7.6% of the total trade sale volume.
Shree Cement’s EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation) for the quarter fell by 2% to Rs 916 crore, compared to Rs 933 crore in the previous year. Managing Director highlighted the company’s strategic efforts to optimise production processes and enhance cost efficiencies despite the challenging market environment. Looking ahead, Shree Cement remains focused on expanding its manufacturing capacity to capture a larger market share. The company is optimistic about the anticipated rebound in cement demand, which it expects to be driven by increased infrastructure investment, rising housing demand, and growth in the rural sector. In line with this strategy, Shree Cement has recently commissioned a new integrated cement unit in Guntur, Andhra Pradesh, with a capacity of 3 million tonnes per annum (MTPA). Additionally, ongoing expansion projects in Rajasthan, Karnataka, Chhattisgarh, and Uttar Pradesh are progressing as planned.
Shree Cement is also exploring further capacity expansions to meet its targets ahead of schedule. As the third-largest cement producer in India, Shree Cement operates well-known brands including Roofon, Bangur Power, Shree Jung Rodhak, Bangur Cement, and Rockstrong. Following the announcement, Shree Cement’s share price on the BSE settled at Rs 2,612.95, reflecting a 2.28% decline from the previous close.
