Birla Corp: Cement Price Slump Squeezes Q1 Profit

Birla Corporation, a key entity of the MP Birla Group, has announced a 3.2% decrease in its consolidated net profit, totaling Rs 115.73 crore for the June quarter of the current fiscal year. This decline was primarily attributed to a slump in cement sales realization and an escalation in power and fuel expenses.

Despite the profit dip, the company's revenue from operations saw a positive uptick, growing by 7.8% to Rs 2,646.45 crore in the same period. However, this revenue growth was tempered by intense competition in the cement market, leading to a rollback of price hikes in June.

The cement division's performance was affected, with EBITDA per ton falling by 6% despite a 5% increase in sales volume. The EBITDA margin for this division stood at 13.6%, a decrease from the previous year, largely due to a 5% rise in power and fuel costs.

Meanwhile, the Jute division experienced a downturn, with revenue down 16.7% due to record-high raw jute prices and supply disruptions, leading to a 27% decline in production. Looking ahead, cement demand is anticipated to remain subdued until August, with recovery expected from September onwards, driven by government initiatives and private sector construction.