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Apr 22, 2013, 09.45 AM IST | Source: Moneycontrol.com

What to expect from UltraTech Cement in Q4

According to a CNBC-TV18 poll, UtlraTech’s YoY Q4 profit will be down 1.8 percent to Rs 712. Sales will be up 3.9 percent to Rs 5545 crore. EBITDA margins will however be down to 21.7 percent from 23.69 percent YoY

Moneycontrol Bureau

On account of a lower than expected recovery in demand, UltraTech Cement is likely to post a marginal year-on-year (YoY) decline in its March quarter profit. The firm, which is to announce numbers today may see sales go up as demand picked up toward the end of the quarter.

According to a CNBC-TV18 poll, UtlraTech’s YoY Q4 profit will be down 1.8 percent to Rs 712 crore. Sales will be up 3.9 percent to Rs 5545 crore. EBITDA margins will however be down to 21.7 percent from 23.69 percent YoY.

Factors that will impact UltraTech's Q4 performance

Historically cement prices tend to see a healthy increase during Q4 but this time Jan-Mar disappointed: Pan India cement prices have increased by just 2 percent quarter-on-quarter to Rs295/bag of 50kg and 4 percent YoY

Moderation in construction and infrastructure activities.

Sales Volumes: Cement Dispatches have come in lower by 1.5 percent  YoY at 11.1 million tonnes.

Realizations: Blended realization is estimated to be higher by 3 percent YoY to Rest 4,700/tonne

Realizations to be partially offset by cost push.

Supplementary business of white cement and RMC are estimated to remain flat.

Margin for all cement manufacturers including UltraTech are likely to come under pressure on account of  

a) Around 7 percent YoY increase in international coal prices

b) Hike in railway freight

c) Increase in rates of bulk diesel

Net profit of the company is expected to decrease

-Largely due to the cost pressure

-Higher interest charges

-Lower other income

 Key issues to watch out

(a) Volume growth recovery and outlook, given the weakness in 4QFY13

- Improve post monsoon (H2 FY14) on account of elections in 5 states followed by general election and onset of peak construction season

(b) Cement pricing outlook, considering unusually weak demand in 4QFY13

(c)Update on capacity addition of 10.2mt, which is slated to commission in 1HFY14

(d) Update on financial performance of Star Cement, UAE

Did you read: Hold UltraTech Cement: Ventura

READ MORE ON  UltraTech Cement Q4
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