Q1 realisation steady; eye IPL revenue in Q3: India Cements

In an interview with CNBC-TV18, VM Mohan, Joint President - Corporate Finance, India Cements said cement realisations have been largely steady in Q1. However, the rise in excise and freight offset the realisation improvement.

India Cements saw -5% growth in monthly sales at Andhra Pradesh but, despite the declining volumes, the company plans to maintain its pricing, informed Mohan.

Besides, India Cements expects some revenue from the IPL team as well in Q3.

Here is the edited transcript of the interview on CNBC-TV18.

Q: If you can start by taking me through the cement realizations in the quarter and where prices are holding up generally in your key markets?

A: Yes, the realizations have been fairly steady and in fact compared to the first quarter of last year, our gross realization has gone up close to Rs 460. Out of this, nearly Rs 280 has been offset because of the increase in excise duty, freight and handling charges.

At the net plant realization level we have had an increase of about 5% which has actually been compensated because of the increase in variable cost. More or less, we have maintained the margin that we achieved in the corresponding quarter of last year.

Currently, there has been some aberration in prices in Andhra. Hopefully, it will settle down. As far as we are concerned, we have decided to set a reasonable price irrespective of the volume and we are going to sell at that price. That is what our policy is and in fact if you see the volume we have also lost a little bit of volume because of this.