Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.

Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Gujarat Ambuja: Above par - Views on News from Equitymaster
  • E-MAIL
  • A  A  A
  • Jan 24, 2002

    Gujarat Ambuja: Above par

    Gujarat Ambuja (GACL) has reported yet another good show for the second quarter ended December 31, 2001. The highlight of the result is the sharp rise in sales despite the slowdown in the economy.

    (Rs m) 2QFY01 2QFY02 Change 1HFY01 1HFY02 Change
    Net sales 2,982 3,501 17.4% 5,498 6,494 18.1%
    Other Income 21 51 142.1% 57 140 143.4%
    Expenditure 1,961 2,334 19.0% 3,628 4,272 17.7%
    Operating Profit (EBDIT) 1,021 1,167 14.3% 1,871 2,222 18.8%
    Operating Profit Margin (%) 34.2% 33.3%   34.0% 34.2%  
    Interest 390 261 -33.1% 713 508 -28.7%
    Depreciation 327 337 3.1% 639 673 5.2%
    Profit before Tax 325 619 90.6% 576 1,181 105.1%
    Tax - 48   - 78  
    Profit after Tax/(Loss) 325 572 76.0% 576 1,104 91.6%
    Net profit margin (%) 10.9% 16.3%   10.5% 17.0%  
    No. of Shares (m) 147.2 147.2   147.2 147.2  
    Diluted Earnings per share* 8.8 15.5   7.8 15.0  
    P/E Ratio   13.7     14.2  

    The total clinker production was higher by 12% at 1.4 m tonnes against 1.3 m tonnes in the second quarter of the previous year. Similarly, production of cement was higher by 18% at 1.8 m tonnes against 1.5 m tonnes. Sales growth was led by higher sales in the domestic markets, which has increased from 1.2 m tonnes in 2QFY01 to 1.5 m tonnes in 2QFY02. Exports have also increased by 8%, thus contributing to almost 17% of sales in absolute terms. Thanks to the cartelisation effect, per bag realisation has remained more or less at the previous year's levels.

    Key numbers…
    (MT) 2QFY01 2QFY02 Change 1HFY01 1HFY02 Change
    – Clinker 1.3 1.4 12.0% 2.4 2.7 14.2%
    – Cement 1.5 1.8 18.1% 2.8 3.3 17.0%
    – Clinker - - - 0.0 - -
    – Cement 1.5 1.8 17.9% 2.8 3.3 16.0%

    Margins have come down by 90 basis points on account of higher raw material costs pertaining to clinker purchases, which hitherto the company was manufacturing itself. Clinker costs as a percentage of total expenses stood at 5% in 2QFY02. But GACL has benefited from lower freight and forwarding costs, which have fallen from 26% of expenses last year to 20% in 2QFY02. Consequently, operating margins for the first half of the current fiscal has increased by 20 basis points. The interest expenses during the current period have declined by 33% on account of restructuring of the high interest bearing debt and retirement of debt.

    The second stats…
    (Rs m) 2QFY00 2QFY01 2QFY02
    Sales 2,830 2,982 3,501
    OPM (%) 38.2% 34.2% 33.3%
    Interest 220 390 261
    Net profit 550 326 572
    NPM (%) 19.4% 10.9% 16.3%

    The company in its press release has stated that cement demand would grow by more than 8% during FY02 in light of sustained demand from housing and road construction sectors. It has also stated that the growth in demand of cement has picked up very well during last 5 months and it has been growing at around 12%. For the first 9 months (April-December 2001), cement despatches of the industry have totaled to 74.5 m tonnes as against 69.4 m tonnes, an increase of 7%. The construction of green field cement plant (Maratha Cement Works) in Chandrapur district (Maharashtra) has been completed and trial production has commenced. This would enable the company to post higher growth in sales in the second half of the current fiscal.

    The stock currently trades at Rs 213 implying a P/E multiple of 14.2x annualised 2QFY02 earnings.



    Equitymaster requests your view! Post a comment on "Gujarat Ambuja: Above par". Click here!


    More Views on News

    Ambuja Cement: Fall in Other Income Drag Bottomline Lower (Quarterly Results Update - Detailed)

    Aug 11, 2017

    While topline witnessed growth on the back of higher cement sale volumes, a 50.5% YoY fall in other income weighed on Ambuja's bottomline during the quarter ending June 2017.

    Ambuja Cem: Net Profits zoom up 361% YoY During Jan-March Quarter (Quarterly Results Update - Detailed)

    May 8, 2017

    Stock price jumps up on Ambuja-ACC merger talks...

    Ambuja Cem: Heavy Monsoon, Subdued Demand Hit Sales (Quarterly Results Update - Detailed)

    Nov 8, 2016

    Heavy monsoon and subdued demand impact Ambuja Cements' cement sales during the quarter ended September 2016.

    UltraTech: Post-Acquisition Cement Capacity Augmented to 93 MTPA (Quarterly Results Update - Detailed)

    Aug 11, 2017

    UltraTech Cement completed the acquisition of cement plants of Jaiprakash Associates Limited (JAL) and Jaypee Cement Corporation Limited (JCCL) during the quarter ended June 2017.

    ACC: Cementing Growth through Capacity Expansion and Favorable Sectoral Developments (Quarterly Results Update - Detailed)

    Jul 20, 2017

    Expanded capacity helped ACC strengthen its market presence in eastern region during the quarter ended June 2017.

    More Views on News

    Most Popular

    Demonetisation Barely Made Any Difference to Tax Collections(Vivek Kaul's Diary)

    Aug 7, 2017

    The data tells us quite a different story from the one the government is trying to project.

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    7 Financial Gifts For Your Sister This Raksha Bandhan(Outside View)

    Aug 7, 2017

    Raksha Bandhan signifies the brother-sister bond. Here are 7 thoughtful financial gifts for sisters...

    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms


    Aug 18, 2017 (Close)


    • Track your investment in AMBUJA CEMENT with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
    • Add To MyStocks


    Compare Company With Charts