North-East demand to drive 22% topline growth : Star Ferro

Star Ferro and Cement expects a topline growth of 22 percent this helped by higher volumes, says Sanjay Gupta, CEO of the company. He says the forecast assumes prices remaining constant.Speaking to CNBC-TV18, Gupta says there is good demand from North-Eastern states on account of the proposed government road and power projects. For the quarter, total capacity utilisation was 70 percent, and volumes grew 22 percent, he adds.Below is the edited transcript of Sanjay Gupta’s interview with Latha Venkatesh and Reema Tendulkar on CNBC-TV18.Latha: Just take us through the sales volume and the capacity utilisation numbers first?A: This quarter total volume has increased from 5 lakh tonne to around 7.12 lakh tonne. In terms of topline growth, it is around 23-24 percent topline growth.Latha: The price per cement, did your realisations improve?A: No, realisations are more or less similar to the last year. So, it has not improved. We are seeing the prices are holding on but they have also not gone down significantly. As the monsoon has already started in north-east, it actually sets in a little early in the north-east but still the prices are holding on. We have seen a reduction of Rs 5-10 overall but that has not dampened the demand as far as the first quarter is concerned. Reema: You indicated your volumes have gone up from 5 lakh tonne to 7.12 lakh tonne. That is a growth of nearly 40 percent but your topline growth is only 27 percent and you said your realisations are practically unchanged. Can you explain that? A: The total volume for the last quarter, the cement sale has been in totality it was 5.34 to 6.52. This is the exact number which I am giving you. So, if you take that into account, it will be around 22 percent. Latha: What about the clinker sales? A: The clinker sales have been pretty insignificant. Last year similar period we had sold around 27,000 tonne and this year we have sold around 35,000 tonne.