ACC net increases by 32%
Mumbai, Feb. 4: India’s second largest cement ma-ker, ACC Ltd, on Thursday beat forecasts with a 32 per cent rise in 2009 net profit on higher prices and lower costs and analysts expect a pick-up in construction to boost the outlook.
Cement demand in India has revived after a sluggish December quarter, helped by accelerating industrial activity. But industry plans to add 90 million tonnes of new capacity by 2011 have raised concerns of pressure on prices in the long term.
"In 2010, we expect demand to grow 11-12 per cent. In the last two months, industry volumes have risen 11.5 per cent, and I expect this trend to continue as there are so many drivers," said Mr Rupesh Sankhe, sector analyst at Angel Broking.
ACC, 46.22 per cent owned by Switzerland’s Holcim, said its capacity would expand to 30 million tonnes by the third quarter of 2010 from 26 million tonnes now. The company said it expected the cement industry to grow by 8 to 10 percent this year, helped by the government thrust on infrastructure and increased construction activity in Asia’s third-largest economy.
ACC said standalone net profit rose to Rs 1,607 crore in 2009 from Rs 1,213 crore a year ago. Net sales rose 10 per cent to Rs 8027 crore, helped by a 2.4 per cent growth in cement volumes and better realisations. Operating margins rose to 30.4 per cent from 23.3 per cent. — Reuters
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