Orient Cement has reported a net loss of Rs 7.58 crore for the quarter ended June 30, 2016 against a net profit of Rs 28.80 crore in the year-ago period.
Total income of the firm, which is part of the USD 1.6 billion C K Birla Group, rose by 29 per cent to Rs 437.13 crore in April-June quarter this fiscal from Rs 339.20 crore during the same quarter in 2015-16.
Total expenses of the company were higher at Rs 425.81 crore against Rs 289.77 crore during the period under review.
In a statement today, Orient Cement said: "The low price environment in our core markets continues to persist. On average, cement net sale realisations have been flat compared to the previous quarter and around 10 per cent lower than the same period last year." Amidst these difficult external developments, the firm continues to focus on its operating efficiencies.
"The high costs related to commissioning/stabilisation of our new integrated unit at Chittapur affected our operating and net profit numbers in the quarter," it said.
However, most of these challenges have now been addressed and with improving capacity utilisation at this unit, the costs are expected to be normalised soon, it added.
The firm expects demand to be subdued in July-September quarter due to ongoing heavy monsoon. However, good rainfall is expected to provide a strong boost to cement demand in the post monsoon months.
"Various government projects for low cost housing, roads, irrigation, metros as well as new initiatives such as Smart Cities & Swachh Bharat are still expected to result in improved demand for cement in Telangana, AP and Maharashtra.
The construction of the new capital of AP at Amravathi is also expected to contribute to higher cement appetite in Southern India, Orient Cement said.
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