Cement firms to post 17% revenue growth: Emkay
Cement companies in Q1FY13 is expected to post revenue growth of +17 per cent yoy as volumes grow 9.5 per cent yoy while realisations are estimated to post growth of +7.3 per cent yoy, according to Emkay Global Financial Services, which has come with its earning estimates of cement sector for June quarter.
Q1FY13 is expected to post revenue growth of +17 per cent yoy as volumes grow 9.5 per cent yoy while realisations are estimated to post growth of +7.3 per cent yoy. Even though April volume growth took a hit due to sand mining ban implemented in various states across Northern and Southern region, the dip in volumes is controlled led by low base and delayed monsoons in June leading to better offtake.
Also average realisations grew 7.3 per cent yoy despite price decline in May (due to lower offtake on account of sand shortage obstructing construction activities) as prices sharply bounce back in June.
On the cost front, railway freight hike (Hike of 23 per cent in base freight by railways from 6th March, 2012) and higher fuel costs (even though international coal prices have softened, the effect is negated by sharp rupee depreciation) are expected to increase total cost/t by 9.8 per cent yoy.
However sequentially costs are estimated to increase by only 0.5 per cent and with realisations growth of 5.2 per cent qoq ( Rs 4508/t, +7.3 per cent yoy )