Adani Group’s cement company ACC Limited posted such a profitable profit in its third quarter (Q3 FY25) that it caught everyone’s attention. The company’s net profit increased by 103 percent to Rs 1,091.73 crore, compared to Rs 537.63 crore at the same time last year. This jump in profits is the result of higher sales, cost reduction and better operations. If compared with the previous quarter, the profit jumped by 447 percent from Rs 199.66 crore to Rs 1,091.73 crore.
Revenue also increased, but profit was surprising
The company’s total revenue increased by 7.25 per cent to Rs 5,207.29 crore from Rs 4,855.22 crore in the third quarter last year. It increased by 15 percent compared to the previous quarter. The company’s EBITDA (earnings before interest, taxes, depreciation and amortization) also grew by 23.4 percent to Rs 1,115.7 crore. However, there has been a slight improvement in the margin, which now stands at 18.8 percent.
The best third quarter in five years
ACC has earned the highest income in the last five years in this quarter. The company’s standalone revenue grew 20.6 percent to Rs 5,927.3 crore from Rs 4,914 crore in the same period last year. The company said that 11 percent growth in trade sales volumes and sales of premium products (which account for 32 percent of trade sales) played a big role in this excellent performance.
Cost reduction became a big factor
ACC also cut costs drastically.
Logistics expenses declined by 9 percent to Rs 939 per tonne.
Kiln fuel cost reduced by 10 percent to Rs 1.68 per ‘000 Kcal.
This was attributed to the use of cheap fuel, higher consumption of petcoke and captive coal and coordination with Adani Group.
What are the expectations for the future?
The company said the cement industry witnessed slow growth in the first half of this financial year, but it expects demand from infrastructure and housing projects to grow at a faster pace in the fourth quarter (Q4 FY25). ACC also has high expectations from India’s Budget 2025. The government’s focus is on infrastructure and housing, due to which the company is seeing a possibility of 4-5 percent growth in the entire financial year.
CEO Ajay Kapoor’s statement
Company CEO Ajay Kapoor said, “Our excellent Q3 results show that we are moving in the right direction. Higher sales, cost reduction and excellent operational efficiency have led us to this success. “We will continue to maintain our market leadership through innovation and strong demand for premium cement products.”
Why are shares falling?
However, despite such excellent results, ACC shares closed at Rs 1,996.25 on BSE, which shows a decline of about 3 percent. It seems that investors sold shares to book profits, due to which this fall occurred.