Falling Rupee hits India Cements profit

Chennai:

The depreciation of Indian rupee has hit India Cements whose net profit for the first quarter of the financial year dipped by 73 per cent to Rs 16.82 crore as compared to Rs 62.07 crore during the same period last year.

Addressing a press conference to announce the first quarter results on Monday, N Srinivasan, vice-chairman and managing director of India Cements said that foreign exchange translation charges due to the unprecendented rupee depreciation has impacted to the tune of Rs 27 crore resulting in net profit before tax of Rs 26 crore against Rs 40 crore in the preceding quarter.

He said with the huge capacity overhang in the south, the selling price and consequently the net plant realization continued to be under pressure during the quarter and this was compounded by the ever increasing cost of inputs on account of power, fuel and depreciation of rupee against dollar and increase in price of petroleum products.

The average net plant realization during the quarter was lower by 10 per cent at Rs 3,185 per tonne against Rs 3,550 per tonne resulting in topline loss of Rs 97 crore which was the primary reason for reduction of EBIDTA (Earnings Before Interest, Taxes, Depreciation and Amortization). The drop in EBIDTA is in line with such drop for the major cement producers in the country.