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UltraTech: Cement volumes get a boost, realisations fall - Views on News from Equitymaster
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  • Apr 26, 2016 - UltraTech: Cement volumes get a boost, realisations fall

UltraTech: Cement volumes get a boost, realisations fall
Apr 26, 2016

UltraTech Cement has announced its financial results for the fourth quarter of the financial year 2015-16 (4QFY16). During the quarter, the company's consolidated net sales and net profit increased by 5.1% YoY and 9.9% YoY respectively. Here is our analysis of the results:

Performance summary
  • On a consolidated basis, sales rise by 5.1% YoY during the quarter driven by 15% YoY growth in domestic cement sales volume. However, the rise in the topline was arrested by 9% fall in average domestic cement realisations.
  • Operating profits grow in line with sales growth; operating margins stay maintained at 20.0%.
  • While depreciation charges increase by 23.0% YoY, finance costs decline by 20.5% YoY.
  • Consolidated net profit increases by 9.9% YoY during the quarter.
  • During the full financial year 2015-16 (FY16), the company's net sales and net profit grow by 5.1% YoY and 9.0% YoY respectively.
  • Net profit margins during the year expand from 8.7% in FY15 to 9.1% in FY16.

    Consolidated Financial Performance Snapshot
    (Rs m) 4QFY15 4QFY16 Change FY15 FY16 Change
    Sales 65,165 68,505 5.1% 240,558 252,807 5.1%
    Expenditure 52,128 54,805 5.1% 199,145 206,612 3.7%
    Operating profit (EBITDA) 13,037 13,699 5.1% 41,413 46,195 11.5%
    Operating profit margin (%) 20.0% 20.0% 17.2% 18.3%
    Other income 1,310 1,080 -17.6% 6,343 4,895 -22.8%
    Depreciation 3,062 3,765 23.0% 12,034 13,684 13.7%
    Finance costs 1,597 1,269 -20.5% 5,865 5,599 -4.5%
    Profit before tax 9,689 9,746 0.6% 29,856 31,807 6.5%
    Tax 3,120 2,515 -19.4% 8,835 8,925 1.0%
    Effective tax rate 32.2% 25.8% 29.6% 28.1%
    Profit after tax 6,569 7,230 10.1% 21,021 22,882 8.9%
    Minority Interest -3 5 NA 38 16 -57.6%
    Net profit 6,572 7,226 9.9% 20,983 22,866 9.0%
    Net profit margin (%) 10.1% 10.6% 8.7% 9.1%
    No. of shares (m) 274.4 274.4
    Diluted earnings per share (Rs)* 83.3
    P/E ratio (x)* 39.5

    *trailing twelve-month earnings

    **Note: On account of the acquisition of Gujarat units of Jaypee Cement Corporation Ltd w.e.f 12 June 2014, the full year (FY16) figures of the company are not strictly comparable with the previous year (FY15) figures.

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