UltraTech profit falls 7% due to increased fuel and power costs

Beats first quarter estimate despite decline on both YoY and sequentially

- VIVEAT SUSAN PINTO

UltraTech, the country's largest cement maker, on Friday reported nearly 7 percent year-on-year decline in net profit to ₹1,584 crore for the quarter ended June 31, 2022 (Q1). Sequentially, too, it plummeted 39.5 percent.

This was because the bottom line was hit by a sharp rise in power and fuel costs. Power and fuel costs, along with freight and handling, account for 55-60 percent of the total cost for cement companies on a per-tonne basis, according to sector analysts.

The prices of both pet coke and thermal coal have risen sharply over the past few months, putting pressure on production costs of cement firms, they said.

Despite the decline on the bottom-line front, UltraTech's net profit beat Street estimates, which came in at ₹1,369 crore, according to a poll of analysts by Bloomberg. Last year, the company reported a net profit of ₹1,703 crore in Q1.