Ambuja Cements Shines with Strong Q3 FY24 Results
Newzdaddy Business Updates
Acquisitions, Expansion, and Cost Efficiency Drive Success
Ambuja Cements, a leading name in the cement and building materials industry and part of the esteemed Adani Group, has reported outstanding financial results for the third quarter of fiscal year 2024. The company’s operational excellence, strategic acquisitions, and efficient cost management have propelled it to new heights of success.
Financial Success:
In the third quarter, Ambuja Cements witnessed remarkable growth in its operating earnings (EBITDA), which surged by a whopping 70% to reach Rs. 1,732 crore. The company’s Profit After Tax (PAT) also saw an impressive increase of 123%, standing at Rs. 1,090 crore.
Key Financial Highlights:
- Ambuja Cements recorded its highest EBITDA in the last 10 quarters, reaching Rs. 1,225 per metric ton.
- The company’s EBITDA margin stood at 21.3%, the highest among its industry peers.
- Diluted Earnings Per Share (EPS) experienced a substantial rise, reflecting strong financial performance.
Financial Strength: Ambuja Cements boasts a robust financial position with cash and cash equivalents amounting to Rs. 8,591 crore, underscoring its stability and liquidity in the market.
Operational Achievements: The company’s strategic acquisitions, including Sanghi Industries and ACCPL, have significantly expanded its market presence, pushing its cement capacity to 77.4 million metric tons per annum (MTPA), a remarkable 15% increase from the previous year.
Expansion Plans: Ambuja Cements is on a growth trajectory with ongoing cement capacity expansion projects, totaling 20 MTPA at various stages. Additionally, the board has approved further expansions, setting a roadmap to achieve 110 MTPA capacity by FY 2028.
Focus on Sustainability: Investments in green power projects, with a significant capital expenditure of Rs. 10,000 crores, aim to increase the share of green power to 60% of expanded capacity while reducing operating costs.
Efficiency and Cost Management: The company has successfully reduced its Total Cost Per Metric Ton (PMT) by Rs. 491 on a consolidated basis. Strategic initiatives such as securing long-term contracts for key raw materials and optimizing operational synergies within the Adani Group have contributed to improved productivity and cost efficiency.
Future Outlook: Ambuja Cements remains committed to its mission of delivering value for all stakeholders and setting new benchmarks in the industry. With a focus on continuous improvement and innovation, the company is poised for sustained growth in the coming quarters.
In conclusion, Ambuja Cements’ stellar performance in Q3 FY24 underscores its resilience, strategic vision, and commitment to excellence in the cement industry.
| Particulars (YoY) | Q3 FY’24 | 9M FY’24 |
| Sales Volume (Clinker & Cement) | Growth of 3% at 14.1 Mn T | Growth of 4.9% at 42.6 Mn T |
| Kiln Fuel Cost | Down by 25%
(Rs 2.45 to Rs 1.84 per ’000 kCal) |
Down by 28%
(Rs 2.68 to Rs 1.92 per ’000 kCal) |
| WHRS as a % of total power Consumption | Up by 6.5 pp to 12.7% | Up by 8.2 pp to 12.0% |
Ambuja Cements is making big waves in the business world with its impressive financial performance and strong growth trajectory. Let’s break down the key highlights and what they mean for the company.
Financial Highlights:
Ambuja Cements has been hitting it out of the park when it comes to financial performance. The company’s EBITDA, which measures its earnings before certain expenses, has been growing steadily. This quarter, it reached an all-time high, with the EBITDA margin hitting 21.3% – the best it’s been in the last 10 quarters.
The company’s cash reserves are nothing short of impressive. In the latest quarter alone, Ambuja Cements added a whopping Rs. 562 crore to its cash pile. Now, its total cash reserves stand at a whopping Rs. 8,591 crore. That’s a lot of financial firepower!
Net Worth and Working Capital:
Ambuja Cements isn’t just stacking up cash – its overall financial health is robust. The company’s net worth, which is like its financial backbone, increased by a staggering Rs. 4,067 crore in the nine months leading up to December 2023. This brought the total net worth to an impressive Rs. 42,824 crore.
When it comes to managing its day-to-day finances, Ambuja Cements is a shining example. Its working capital cycle, which measures how quickly it can turn its assets into cash, is just 26 days. That’s among the best in its industry peers.
Financial Performance Summary:
Ambuja Cements’ success isn’t just about numbers – it’s about resilience and foresight. By focusing on efficiency, profitability, and smart financial management, the company is cementing its position as a leader in the industry. With a solid foundation and an eye on the future, Ambuja Cements is building a legacy that will stand the test of time
For the Quarter ended Dec’23
| Particulars | UoM | Consolidated | Standalone | ||
| Q3 FY’24 | Q3 FY’23 | Q3 FY’24 | Q3 FY’23 | ||
| Sales Volume (Cement and Clinker) | Mn T | 14.1 | 13.7 | 8.2 | 7.7 |
| Revenue from Operations | Rs. Cr | 8,129 | 7,907 | 4,440 | 4,129 |
| Operating EBITDA & Margin
(Excl. Other Income)
|
Rs. Cr | 1,732 | 1,021 | 851 | 639 |
| % | 21.3% | 12.9% | 19.2%* | 15.5% | |
| Rs PMT | 1,225 | 744 | 1,043 | 829 | |
| Other Income | Rs Cr | 194 | 117 | 108 | 76 |
| Profit Before Tax | Rs. Cr | 1,448 | 623 | 680 | 464 |
| Profit After Tax | Rs. Cr | 1,090 | 488 | 514 | 369 |
| EPS – Diluted | Rs. | 3.86 | 2.02 | 2.41 | 1.71 |
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* For Ambuja Standalone, ~12% of the Clinker capacity of Ambuja (Standalone) was under planned maintenance resulting in lower cost absorption for the quarter, benefits will accrue coming quarter.
For the Nine Months Ended Dec’23
| Particulars | UoM | Consolidated | Standalone | ||
| 9M
FY’24 |
9M
FY’23 |
9M
FY’24 |
9M
FY’23 |
||
| Sales Volume (Cement and Clinker) | Mn T | 42.6 | 40.6 | 24.9 | 22.2 |
| Revenue from Operations | Rs. Cr | 24,266 | 23,071 | 13,139 | 11,802 |
| Operating EBITDA & Margin
(Excl. Other Income)
|
Rs. Cr | 4,701 | 2,459 | 2,573 | 1,639 |
| % | 19.4% | 10.7% | 19.6% | 13.9% | |
| Rs PMT | 1,103 | 606 | 1,035 | 738 | |
| Other Income | Rs Cr | 933 | 363 | 676 | 746 |
| Profit Before Tax | Rs. Cr | 4,299 | 1,557 | 2,426 | 1,759 |
| Profit After Tax | Rs. Cr | 3,212 | 1,405 | 1,802 | 1,557 |
| EPS – Diluted | Rs. | 11.90 | 6.28 | 8.50 | 7.69 |
Community Engagement and Environmental Initiatives
Ambuja Cements is making headlines with its forward-thinking strategies and commitment to sustainability. Let’s delve into the key highlights and understand what sets Ambuja apart in the cement industry.
Industry Growth and Ambuja’s Role:
The cement industry is booming, with an expected demand growth of 7% to 8% driven by infrastructure and real estate projects. India’s per capita cement consumption is below the global average, indicating huge growth potential. Ambuja Cements is at the forefront, investing in green power projects like solar and wind energy, ensuring a sustainable future.
Cost Optimization and Fuel Efficiency:
Ambuja is not just focusing on growth; it’s also mindful of costs. By smartly managing fuel expenses and investing in technologies like Waste Heat Recovery Systems (WHRS), the company is optimizing costs and improving profitability. Recent purchases of low-cost petcoke further demonstrate Ambuja’s commitment to efficient operations.
Branding and Community Engagement:
Ambuja Cements isn’t just a cement company; it’s a brand that cares. Partnering with the ‘Gujarat Giants’ for the Ultimate Kho-Kho League and sponsoring the Women’s IPL showcase its dedication to sports and community engagement. Thematic campaigns during the Cricket World Cup and robust interactions with technical groups highlight Ambuja’s efforts to promote ethical and eco-friendly building practices.
Environmental and Social Impact:
Ambuja’s commitment to Environmental, Social, and Governance (ESG) principles is commendable. With investments in solar and wind power projects, Ambuja aims to increase green power usage to 60% of its planned capacity. The company is also a leader in water governance, maintaining an 8x water-positive ratio. Over 2.5 million people benefit from Ambuja’s CSR initiatives, focusing on sustainable livelihoods and women empowerment.
Awards and Recognitions:
Ambuja Cements’ excellence has been recognized with awards like the CII SCALE Awards 2023 for logistics and the Safety Excellence Award at UPES Sustainability Fair 2.0. The Bhatapara plant also received the APEX India OH&S ‘Platinum Award,’ showcasing Ambuja’s commitment to safety and operational excellence.
Conclusion:
Ambuja Cements is not just a cement manufacturer; it’s a beacon of sustainability and success in the industry. With a focus on growth, community engagement, and environmental stewardship, Ambuja is paving the way for a brighter, greener future.
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