Star Cement (540575) Q4 10/11 earnings summary

Executive summary

• Consolidated net sales rose 7.67% to ₹48,592.50 lacs, ahead of pan-India cement demand growth of 4.82%; consolidated profit after tax was ₹12,062.05 lacs.

• Cement production reached a record 963,715 MT, up 5%; combined cement and clinker sales reached a record 970,913 MT.

Financial highlights

• Consolidated net sales increased from ₹45,130.87 lacs to ₹48,592.50 lacs; consolidated EBITDA declined 4.47% to ₹15,236.44 lacs.

• Consolidated PBT fell to ₹11,761.73 lacs from ₹12,900.39 lacs; PAT after minority interest was ₹12,062.05 lacs versus ₹12,315.59 lacs.

• Standalone net sales were ₹32,458.46 lacs versus ₹30,562.86 lacs; standalone PAT was ₹8,345.83 lacs versus ₹9,572.41 lacs.

• Consolidated gross sales were ₹55,064.42 lacs, up from ₹50,612.21 lacs; gross cash accruals were ₹15,211.90 lacs versus ₹14,567.85 lacs.

Outlook and guidance

• A 1.75 MTPA clinker unit at Lumshnong and two 1.6 MTPA grinding units at Guwahati and Kahalgaon were under implementation; Guwahati was expected to operate by Q2 FY13.

• A 43 MW power plant was under development, with operations expected by Q2 FY13; expanded assets were projected to support consolidated turnover of ~₹2,00,000 lacs in FY14.

• Following expansion, clinker capacity was projected to double to 2.55 MTPA, cement capacity to reach 4.4 MTPA and aggregate power capacity to reach 71 MW.

• Cement demand was expected to grow 8–10% nationally over the next few years; North East demand was forecast to sustain 15% CAGR over the next three years.