Tag: Shree Cement

Shree Cement expects 8-10% volume growth in FY25

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shree Cement expects volumes to grow at 8-10% in April-March 2024-25.

The Kolkata-based cement manufacturer beat Street estimates in the January-March quarter, recording volumes of 9.53 metric tonnes versus the expected 9.4 metric tonnes.

The earnings before interest, tax, depreciation, and amortisation (EBITDA) was also better due to only a lower than estimated contraction in realisations, and higher operating leverage with fuel costs dropping nearly 15% from last year.

Speaking to CNBC-TV18, HM Bangur, Chairman of Shree Cement said the demand may be deferred due to seasonal fluctuations, but it eventually picks up.

With India’s continuous development, the need for cement and infrastructure will remain high, providing a foundation for sustained demand growth, he noted.

Shree Cement reported revenue growth of ₹5,101 crore for January-March.

EBITDA margin was at 26%, better than Street estimates of 22.8%, EBITDA per tonne was ₹1,392 versus ₹1,388 in the third quarter. 

Bangur refrained from giving a guidance on the EBITDA per tonne given the significant influence of fluctuating commodity prices. However, he is confident that increasing efficiency levels and reducing energy consumption costs will improve performance.

He said cements price increases have historically been slightly below general inflation rates, typically 1 to 2% less.

However, he believes that the company will maintain profitability even with modest prices increases given that the technological advancements and innovations are helping tame costs.

Brokerage firm Nomura rated the stock a buy with a target price of ₹33,400 per share due to the strong results

It noted that Shree Cement’s EBITDA per tonne was higher than Ultratech’s for the third quarter in a row.

Investment bank Morgan Stanley is also overweight on Shree Cement and has a target price ₹30,000 per share.

Brokerage firm Jefferies has a ‘hold’ rating with a target of ₹29,500 per share.

Shree Cement currently has a market capitalisation of ₹93,449.14 crore. Its shares have gained 5% over the last year.

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Shree Cement Q4 Result: Profit after tax jumps 21%, announces dividend of ₹55 per share

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shree Cement posted a 21% year-on-year increase in the profit after tax at ₹662 crore for the quarter ended March 2024. The revenue from operations for the fourth quarter rose 7% year-on-year to ₹5,101 crore. The cement maker’s annual turnover grew 16% to ₹19,586 crore. 

The sales volume during the quarter under review increased 8% to 9.53 million tonnes, as compared to 8.83 million tonnes in the corresponding quarter in the previous year. The Earnings Before Interest, Taxes, Depreciation, and Amortisation came the highest-ever level of ₹1,327 crore, 49% up from ₹892 crore.

The board also declared a final dividend of ₹55 per equity share for the fiscal year 2023-24.

For the financial year 2024, the company reported a consolidated profit after tax (PAT) of ₹2,468 crore, up from ₹1,328 crore in FY23. The revenue for the said period amounted to ₹19,586 crore, compared to ₹16,837 crore in the previous fiscal year. The Earnings Before Interest, Taxes, Depreciation, and Amortisation for the financial year stood at ₹4,364 crore. This is the company’s highest-ever full-year operating EBITDA.

In its financial statement, the company said that it targets 65.8MTPA capacity by March 2025. It also plans on investing ₹4,500 crore on expansion in FY25.

The shares of the cement maker ended 0.3% in the trade today.

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Shree Cement shares rally as Q3 profit more than doubles and margin expands to 25%

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shree Cement shares surged in early trade on February 1, a day after the firm reported its earnings for the October to December 2023 quarter, in which its standalone profit jumped 165% to ₹734 crore, beating the CNBC-TV18 poll projection of ₹607 crore.

Shree Cement shares traded 5.89% lower from the previous close at ₹30,218.65 on BSE at 9:46 am.

Brokerage firm Morgan Stanley lauded the volumes, which it said were likely led by market share gains in the eastern region. However, it maintained its equal-weight call on the company and set a target price of ₹28,500, which is slightly lower than ₹28,538.95.

Morgan Stanley noted that the strong volume growth outlook continues with a rising share of premium products. And that, better volumes coupled with a good show on opex drove good earnings before interest, taxes, depreciation, and amortisation (EBITDA) beat.

The brokerage comments come as Shree Cement’s total sale volume increased 11% YoY in the December 2023 ended quarter to 8.89 million tonnes from 8.03 million tonnes in the same quarter last year.

Following the Q3 results, SCL Managing Director Neeraj Akhoury said the company was executing a comprehensive performance improvement plan, and we are experiencing a positive impact.

“Strong volume growth along with building premium products through accelerated channel expansion and softening of fuel prices has helped us to deliver a robust improvement… We are fully prepared to complete our various projects to reach beyond 80 million tonnes of cement production capacity by the year 2028,” he said.

EBITDA for the quarter surged 74% YoY to ₹1,234 crore from ₹708 crore in the year-ago period, while margin expanded by 780 basis points to 25.2% from 17.4% in Q3FY23.

The cement maker’s net revenue from operations for the quarter has risen 20% YoY to ₹4,901 crore, compared with ₹4,069 crore in the same quarter last year.

Recently, the company commenced commercial production from its integrated cement plant at village Gothra in Nawalgarh Tehsil of Rajasthan having a clinker capacity of 11500 tonnes per day (3.8 MT per annum) and cement capacity at 3.5 MT per annum with effect from January 22, 2024.

The work on 18 MT capacity expansion projects already announced is running as per schedule.

Additionally, the company has decided to add one more cement mill of 3 MT per annum capacity at its upcoming plant at Ras in Rajasthan. On completion, its total India cement capacity will be around 75 MT.

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Shree Cement Q3 Results: Profit jumps 165% to ₹734 crore; ₹50 dividend declared

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shree Cement Ltd. on Wednesday reported a 165% year-on-year (YoY) jump in standalone net profit at ₹734 crore for the October-December quarter, compared with ₹276.77 crore in the same quarter last year. The profit figure was much higher than CNBC-TV18’s poll of ₹607 crore.

The cement maker’s net revenue from operations for the quarter rose 20% YoY to ₹4,901 crore, compared with ₹4,069 crore in the same quarter last year.

Total sale volume increased 11% YoY to 8.89 million tonnes in the December quarter from 8.03 million tonnes in the same quarter last year.

EBIDTA for the quarter surged 74% YoY to ₹1,234 crore from ₹708 crore in the year-ago period, while margin expanded by 780 basis points to 25.2% from 17.4% in Q3FY23.

The Board of Shree Cement has also declared an interim dividend of ₹5O per equity share of ₹10 each for the financial year 2023-24. The record date for the said dividend has been fixed on February 8, 2024. The dividend will be paid on February 21, 2024.

Capex plans

Recently, the company commenced commercial production from its integrated cement plant at village Gothra in Nawalgarh Tehsil of Rajasthan having clinker capacity of 11500 tonnes per day (3.8 MT per annum) and cement capacity at 3.5 MT per annum with effect from January 22, 2024.

The work on 18 MT capacity expansion projects already announced is running as per schedule.

Additionally, the company has decided to add one more cement mill of 3 MT per annum capacity at its upcoming plant at Ras in Rajasthan. On completion, ITS total India cement capacity will be around 75 MT.

“Shree Cement is executing a comprehensive performance improvement plan, and we are experiencing a positive impact. Strong volume growth along with building premium products through accelerated channel expansion and softening of fuel prices has helped us to deliver a robust improvement,” said Neeraj Akhoury, Managing Director at Shree Cement.

Akhoury said the company has commissioned Purulia and Nawalgarh plant this year and its capacity growth plans are on track.

“We are fully prepared to complete our various projects to reach beyond 80 million tonnes cement production capacity by year 2028,” he added.

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Shree Cement: I-T dept claims ₹4,000 crore demand for wrongful claims & deductions

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In a major tax evasion detection, the income tax department claims ₹4,000 crore demand against cement manufacturer – Shree Cement.

According to senior government official, who did not wish to be named, the tax demand of ₹4,000 crore is including tax due, interest and penalty against the company for wrongful claims and deductions.

“IT department post the survey in its report has found that Shree cement had raised wrongful deductions under section 80-IA of Income Tax act,” the official told CNBC-TV18.

The I-T department conducted a survey action at five locations of the company in June 2023 in connection with the deductions claimed under section 80IA of the Income Tax Act for the April 2014 to March 2023 period.

The survey took place at the company premises in Beawar, Jaipur, Chittorgarh, and Ajmer.

“IT dept survey claims Shree Cements raised wrongful claims of ₹8,500 crore between April 2014-March 2023 and major violations for claiming deductions for waste management, water treatment and power infrastructure,” official said.

As per the report filed by tax officials post the survey action, “Shree cement claimed ₹7,000 crore wrongful deduction for solid waste management but during the survey, IT department could not find any such utility at any of the company premises.

Similarly, the company has raised ₹250 crore wrongful deduction for water treatment plant, but during investigations it was found that the company only has a RO water unit, which is used for employees and no treatment plant has been installed at any of the company facilities,” official said.

Not just this, the official highlighted that the “survey investigations also say that the company wrongfully claimed deduction under New India Power Undertaking Scheme, whereas the company has only repurposed old machinery to start a power plant for which it had claimed deductions earlier.”

It is important to note that in a separate government action, the Ministry of Corporate Affairs (MCA) had issued an inspection order against the Kolkata-based cement manufacturer on reports of improper income tax filings. The order was issued taking note of issues such as party transactions, corporate governance matters and issues pertaining to improper income tax filings.

A survey action of the I-T department is an investigative procedure carried out to ascertain the actual income earned by a tax payer for a financial year.

However, Shree Cement has dismissed any tax evasion reports. The alleged tax evasion, according to the reports, is said to be the biggest ever to date.

The company had said: “Income Tax Department is conducting a survey at our premises, and the company’s management team is available and extending full cooperation to the officials. The information as required by the officials is being made available.”

Shares of Shree Cement are currently trading 4.21% lower at ₹27,165 on the NSE. The stock has also turned negative so far this year.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Shree Cement sees demand for premium products aiding growth amid real estate upswing

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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HM Bangur, Chairman of Kolkata-based Shree Cement expects a healthy volume and EBITDA (earnings before interest, tax, depreciation, and amortisation) growth this year.

In a conversation with CNBC-TV18, he noted that apart from the government’s efforts in infrastructure development ahead of the elections and the general upswing in real estate, a key driver of the growth in cement business is the increasing demand from high-net-worth individuals (HNIs).

These HNIs are investing in premium properties, particularly in smaller cities and villages, thereby generating substantial demand in these areas for high-priced, better quality cement, Bangur said.

Shree Cement has strategically positioned itself in the market, offering superior quality cement at competitive prices. In the second quarter, the company’s sales of premium products rose to 9.5% of the total trade sales, compared to 7.5% in the previous year.

Bangur predicts a growth of more than 20% in absolute EBITDA for the second half of the year.

“As sales will be higher, costs are down, and prices are good, we anticipate over 20% EBITDA growth in absolute terms in the second half,” he said.

Read Here | JK Cement targets 15-16% volume growth in FY24, to focus on premium sales

On November 7, the cement maker reported around 159% year-on-year (YoY) jump in standalone net profit to ₹491.3 crore for the second quarter from ₹190 crore last year.

The company’s standalone revenue from operations increased over 21% to ₹4,585 crore against ₹3,781 crore in the corresponding period of the preceding fiscal. EBITDA margin shot up to 19% from 13.85% a year ago.

Bangur also shared updates on the company’s ongoing brownfield and greenfield expansions.

“We are occupied until 2027-2028. Currently we are at 48 million tonnes; we will reach 71 million tonnes by March 2027 and 80 million tonnes by 2028. Until then, we can’t take on more projects. Our focus is on our existing greenfield and brownfield units.”

Shree Cement company has a market capitalisation of ₹97,438 crore. The company’s shares have gained around 7% in a month, mirroring the Nifty 50 returns. The company competes with cement makers such as Ambuja Cements, ACC, India Cements, and Dalmia Bharat.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Shree Cement foresees 12% volume growth amid capacity constraints

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shree Cement shares traded in the red on November 8, even though the cement maker reported a robust set of numbers for the second quarter of FY24. The company’s consolidated net profit soared twofold from last year to ₹446.62 crore, aided by strong sales volume and improved operational metrics.

Shree Cement’s sales volume for the quarter rose 10% to 8.20 million tonnes from 7.46 million tonnes.

“It’s (volume growth) at about 13-14% in the first half; the second half will be a little lower. So, overall, the volume growth will be at least 12%. It can be a little higher too,” Chairman HM Bangur told CNBC-TV18 in a post-earnings chat. For the next fiscal 2024-25, he expects a minimum volume growth of 12%.

Even as the company’s standalone revenue from operations increased 21.3% YoY to ₹4,584.6 crore and earnings before interest, taxes, depreciation, and amortisation or EBITDA jumped 66.2% to ₹869.6 crore, Shree Cement

While capacity is a constraint at the moment, Bangur said new capacities will be added within the next two years. “By the end of FY24, our capacity will go up to 56mt (million tonne) from the current 50mt. Next year, it will be about 62mt. So, in the next two years, 12mt capacity will be added,” he said.

In the September quarter, the Kolkata-based firm’s capacity utilisation improved from 65% to 71% on a YoY basis.

The board of Shree Cement has approved the setting up of a brownfield cement grinding capacity of 3.40mt per annum at its existing facilities in Chhattisgarh with an estimated capital expenditure of ₹550 crore. This project is expected to be completed by September 2025.

Bangur also told CNBC-TV18 that the firm is not looking at inorganic growth unless it’s “really good”.

On the income tax (I-T) department’s survey action at five locations of Shree Cement in Rajasthan, Bangur said, no progress has been made so far. “Things are at where they were in the last quarter.”

The company’s shares were trading around 1.5% lower at ₹26,306 on the NSE. They have gained more than 7% over the last six months and around 13% over the last 12 months.

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Shree Cement Q2 net profit zooms 159% to ₹491 crore on strong sales, beats estimates

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Leading cement company Shree Cement Ltd on Tuesday, November 7, reported a 158.95% year-on-year (YoY) jump in standalone net profit at ₹491.3 crore for the second quarter that ended September 30, 2023.

In the corresponding quarter last year, Shree Cement posted a net profit of ₹190 crore, the company said in a regulatory filing. The CNBC-TV18 poll had predicted a profit of ₹453 crore for the quarter under review.

The company’s standalone revenue from operations increased 21.3% to ₹4,584.6 crore against ₹3,781 crore in the corresponding period of the preceding fiscal, beating CNBC-TV18 poll’s forecast of ₹4,448 crore for the quarter under review.

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At the operating level, EBITDA jumped 66.2% to ₹869.6 crore in the second quarter of this fiscal over ₹523.2 crore in the corresponding period in the previous fiscal. The CNBC-TV18 poll had predicted an EBITDA of ₹874 crore for the quarter under review.

EBITDA margin stood at 19% in the reporting quarter against 13.85% in year-ago period. EBITDA is earnings before interest, tax, depreciation, and amortisation. A margin of 19.65% had been estimated by the CNBC-TV18 poll for the quarter under review.

The company’s net revenue surged 21% from ₹3,781 crore to ₹4,585 crore compared to the same period last year. The total sales volume also showed a notable uptick, increasing by 10% year-on-year, from 7.46 million tonnes (MT) to 8.20 MT.

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One key highlight of Shree Cement’s Q2 performance is the improvement in capacity utilisation, which rose from 65% to 71% on a YoY basis. Furthermore, sales of premium products rose to 9.5% of the total trade sales, compared to 7.5% in the previous year.

The board of directors approved the setting up of a brownfield cement grinding capacity of 3.40 MT per annum capacity at the company’s existing facilities in Baloda Bazar district of Chhattisgarh with an estimated capital expenditure of ₹550 crore. This project is estimated to be completed by September 2025.

The results came after the close of the market hours. Shares of Shree Cement ended at ₹26,692.15, up by ₹291.75, or 1.11%, on the BSE.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Shree Cement board approves proposal to raise up to Rs 700 crore via NCDs

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shree Cement Ltd on Monday, September 25, announced that its board has approved a proposal to raise up to Rs 700 crore through an issue of non-convertible debentures (NCD) on a private placement basis.

The secured, rated redeemable and taxable NCDs with a base issue size of Rs 350 crore with an option to retain oversubscription of up to Rs 350 crore will be allotted on September 26, 2023, at a face value of Rs 1,00,000 each for cash at par, the cement manufacturer said in a filing to the stock exchanges.

The date of maturity of the NCDs to be issued on a private placement basis to certain eligible investors is October 26, 2030.

The interest will be payable on an annual basis and on redemption, Shree Cement said.

The cement maker in July had announced that it was looking to expand its clinker and cement manufacturing capacity to boost its business operations across the country.

The company had announced a proposed investment of Rs 7,000 crore, to be funded through internal accruals and debt, for the expansion plans.

The existing cement capacity of the company, including that of its subsidiaries, is 49.9 million tonnes per annum. The utilisation rate of the company stood at 70 percent in FY23.

The company proposes to set up a 3.65 million tonnes clinker plant at Pali in Rajasthan and cement units of 6 million tonnes capacity in Pali (Rajasthan) and Etah in Uttar Pradesh.

Shree Cement also plans a 3.65 million tonnes clinker plant at Kodla and cement capacity of 6 million tonnes in Kodla and Bengaluru in Karnataka.

The capacity is proposed to be added by the end of March 2025.

Brokerage Bernstein last week downgraded Shree Cement along with two other cement makers citing limited room for improvement in operating margins due to high fuel inflation.

Bernstein downgraded Shree Cement to underperform and reduced its target price from Rs 23,187 per share to Rs 22,341 per share, implying a potential downside of 14 percent.

Shree Cement shares were trading lower by 0.34 percent at Rs 25,844.85 apiece on BSE at 10.48 AM.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow