Cement maker ACC is expected to report more than a 10 percent decline in Q1CY20 profit due to fall in revenue and operating income.
Revenue could also fall more than 10 percent as volumes were affected in March due to lockdown announced by the government to control the spread of COVID-19, but may be supported by higher realisation.
Brokerages largely expect realisation to increase in the range of 1-2 percent. But a 9-15 percent decline in sales volumes is expected due to weakness in eastern and southern markets.
"Volume is expected to decline 12 percent YoY, while realisation is expected to improve 1 percent YoY (up 1.7 percent QoQ). As a result, revenue might decline 10.6 percent YoY," Emkay said.
ICICI Direct expects a 15 percent decline in volume for Q1 owing to weakness in the eastern and southern markets. "Realisations of the company are expected to increase 1.8 percent YoY, thus implying a revenue decline of 13.5 percent YoY."
The company follows January-December quarter as a financial year.
At the operating level, earnings before interest, tax, depreciation and amortisation (EBITDA) could also decline in single-digit but EBITDA per tonne is expected to increase, and margin may see some expansion due to price hike taken during the quarter.
"EBITDA per tonne is expected to rise 14.6 percent YoY. Absolute EBITDA and PAT are estimated to decline 3 percent and 12 percent YoY, respectively," ICICI Direct said.
Kotak Institutional Equities also expects cement EBITDA per tonne to moderately increase by 13 percent YoY led by higher realisation and lower variable costs partially offset by higher fixed cost from volume loss.
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