Prices to remain stable: India Cements

N Srinivasan, Vice Chairman and MD of India Cements said cement prices range between Rs 213 in Andhra Pradesh to about Rs 265 to Rs 270 in Karnataka, Tamil Nadu and Kerala and the demand is firm and they are quite sold out.

Excerpts from CNBC-TV18's exclusive interview with N Srinivasan:

Q: If you could outline the growth that you have seen in the current quarter, has the quarter been as good for you, just outlining the Q4FY08 sales and the PAT numbers?

A: The Q4 was good and we look at the year as a whole because of the income tax and some one time charges were also debited to that quarter. I would like to talk about the year as a whole, the sales went up from Rs 2,600 crore to Rs 3,500 crore. The total sales went up from 8.4 million tonne to 9.2 million tonne of cement and the EBDITA from Rs 744 crore went up to Rs Rs 1130 crore. PAT was Rs 892 crore compared to Rs 490 crore in the previous year and the PAT after providing, was about Rs 200 crore, out of which Rs 180 crore was deferred tax; it's about Rs 638 crore this year which is a substantial improvement over last year.

Q: What would the compilation be in terms of Q4 numbers and how much have you clocked in by way of net sales and PAT for Q4?

A: The gross profit in Q4 was around Rs 238 crore. But we had one time charges and impact of tax, so the net number is about Rs 110 crore or so, but you must look at it for the year as a whole. But the PBT gross was quite good.

Q: How has been the tax adjustment for Q4, and has there been higher tax provisioning for Q4 as opposed to the quarters before?

A: I don’t have that number in front of me, but yes there is a higher tax provision, but my overall EBDITA margins went up from 32.8% to 36.5% for the last year.

Q: How has the price scenario been especially in south India? We have heard reports of how the industry has probably agreed to not raise the prices, but the southern part of India has, probably due to the demand-supply adversity, seen a bit of a price rise, what is the current realisation that India Cements as a company has?

A: The price is firm and stable

Q: Could you put a number to that?

A: It's about the same, the price ranges between Rs 213 in Andhra Pradesh to about Rs 265 to Rs 270 in Karnataka, Tamil Nadu and Kerala and the demand is firm and we are quite sold out.

Q: What does the margin picture look like? I am not asking for specific numbers, but in the current quarter gone by, you would have seen an increase in coal prices. I am just wondering about the impact coal has had on the companies such as yourselves, how does that picture look?

A: That is a direct price related question or a profit related question. We have just finished the quarter, so in the next to to three weeks we will talk again.

Q: In terms of the revenue or the benefits that India Cements as a company would get from IPL, we know that you straight away get an advertising benefit on how the teams perform going ahead, but in terms of the revenue break up, was there any kind of a benefit that accrued to the company in the current year?

A: Certainly, we have made and there is a revenue break up and we have already said that we make a profit in the first season and now that we are in the champions, we are going to play the Champions League, so there will be a substantial additional income also. So I think it’s win-win for us all around.