The Hindu Business Line : Ambuja Cements Q1 net increases 43%

Good times
Net sales up 34 pc to Rs 1,434 crore
Rs 241 cr from sale of shares in associate co
Plans sale of property at Kalina, Mumbai

Mumbai April 20 Ambuja Cements Ltd (earlier Gujarat Ambuja Cements Ltd) has said that its first-quarter profit has risen by 43 per cent, thanks to higher realisations, lower costs and a one-time profit from sale of shares in an associate company.

Net profit for the quarter ended March 31, 2007 was reported at Rs 590.74 crore, up from Rs 412.77 crore in the corresponding previous period.

Net sales grew 34 per cent to Rs 1,434 crore (Rs 1,074 crore), while volumes sales grew four per cent to 4.34 million tonnes (4.18 million tonnes).

"There was good demand and good growth, and production costs were under control," said Mr Anil Singhvi, outgoing Managing Director.

"This is the best quarter ever in the 21 years in terms of EBITDA margins, sales volumes and profits."

EBITDA rose 94 per cent to Rs 829 crore (Rs 427 crore).

Other income was higher at Rs 266 crore (Rs 57 crore), largely due to a one-time gain of Rs 241 crore from sale of 9.54 crore shares in associate company, Ambuja Cement India, to a Swiss company called Holderind Investments.

(As per an agreement with Holderind, Ambuja will sell another 9.54 crore shares on April 30, 2007 for Rs 535 crore and an equal number on April 30, 2008 for Rs 589 crore.)

Interest costs during the quarter under review dipped to Rs 2 crore (Rs 11 crore).

Mr Singhvi said that he expects the financial growth to be repeated for several quarters.

"These are good times, demand is good, supply-side constraints remain with not many new capacities coming up.

The company has lined up sale of its property at Kalina in Mumbai; the highest bid received is for Rs 333 crore.

The company's scrip gained 1.76 per cent on the BSE on Friday, to close at Rs 115.45.

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