UltraTech Cement (ULTRACEMCO) Q4 16/17 earnings summary

Executive summary

• FY17 cement sales volume 50.19 MMT, up 2% YoY; domestic sales 47.62 MMT, up 1%, and production 47.91 MMT, up 1%.

• Installed cement capacity reached 66.25 MTPA; utilization was 72% versus 76% in FY16, reflecting the higher capacity base and muted demand.

Financial highlights

• Consolidated revenue from operations was ₹28,645.93 crore versus ₹28,391.59 crore; PBIDT was ₹5,861 crore versus ₹5,365 crore.

• Consolidated profit for the year was ₹2,713.51 crore versus ₹2,479.62 crore; profit attributable to owners was ₹2,714.92 crore versus ₹2,478.04 crore.

• Standalone net profit rose to ₹2,627.72 crore from ₹2,370.16 crore; basic EPS was ₹95.74 versus ₹86.37.

• Standalone other income included a ₹138.10 crore reversal of an earlier-year provision; a ₹13.69 crore investment impairment was recorded as an exceptional item.

Outlook and guidance

• Cement demand was expected to pick up gradually, supported by affordable housing, infrastructure spending, rural housing and improving South India demand; urban housing and private capex remained weak.

• FY18 capital expenditure was estimated at ~₹2,200 crore, mainly for capacity expansion, regulatory needs, infrastructure and maintenance.

• The 3.5 MTPA integrated Dhar plant, approved at ₹2,600 crore, was expected to begin commercial production by Q4FY19.

• Completion of the 21.20 MTPA Jaypee plants acquisition was expected by Q1FY18, subject to remaining approvals, including transfer of mineral concessions.