Heidelberg swings into loss in June quarter on high spend

Moneycontrol Bureau

Heidelberg Cement India has swung into loss of Rs 8 crore for the June quarter as against Rs 19.2 crore profit it posted in the year-ago period as input cost rose significantly. Sales, however climbed around 18 percent year-on-year to Rs 358 crore as demand. improved in the quarter gone by.
While freight cost went up 40 percent Rs to 567 crore, power and fuel cost shot up to Rs 1036 crore from Rs 776 crore Y-o-Y.
Shares of the company declined 3.5 percent to Rs 37.50 post earnings announcement.
Cement companies are going through pricing pressure and sluggish demand as infra and construction activities have slowed down in most regions due to scheduled elections across states. 
This is evident from ACC Ltd and Ambuja Cements posting a 37 percent and 31 percent drop in profits Y-o-Y on similar issues..However, demand may pick up toward end of FY14, say analysts.
Read This:Heidelberg Cement to sell Raigad grinding unit to JSW Group
The company which recently decided to sell its 0.6 million tonne per annum (mtpa) cement grinding facility in Raigad to JSW Group, has a capacity to produce five mtpa cement in India. The sale of the unit is in line with its philosophy of divesting less strategic assets with lower margins to focus on more strategic and key operations in central India, it had said at the time of entering into an agreement with JSW Group last month..
Meanwhile, cement companies are going through pricing pressure and sluggish demand as infra and construction activities have slowed down in most regions due to scheduled elections across states. Demand may pick up toward end of FY14, say analysts.