MUMBAI (Reuters) - India's second-biggest cement maker, ACC Ltd., beat expectations on Thursday with quarterly profits more than doubling on higher prices and strong demand, and forecast a good outlook.
ACC, one-third owned by Switzerland's Holcim, said it expects the industry-growth to continue in the coming year on the back of investments in housing, infrastructure and plans for developing special economic zones.
Demand for cement in India is expected to rise 10 percent annually, faster than the growth in supply, as most new capacities will be operational only by end-2007/08 or in 2009, analysts said.
Capacity additions could be lower than estimated because of delays in commissioning new plants and issues over land acquisition, underpinning cement prices that rose 30 percent in October-December from a year earlier.
ACC said standalone net profit rose to 3.58 billion rupees in the three months ended Dec. 31, from 1.73 billion a year earlier. Sales grew 50 percent to 16.2 billion rupees from 10.8 billion.
A Reuters poll of 10 brokerages had forecast for net profit of 2.94 billion rupees on sales of 15.43 billion.
Last week, diversified Grasim Industries Ltd., which gets more than 60 percent of its revenue from cement, also reported quarterly profit more than doubled.
UltraTech Cement, a unit of Grasim, reported a 783 percent jump in quarterly profit last month.
ACC, which has a capacity of about 20 million tonnes, said it would be expanded to 23.1 million tonnes by December, and to 27.3 million tonnes in the next two years.
ACC shares, valued at $4.4 billion, were 1.5 percent higher at 1,035.55 rupees by late afternoon in a Mumbai market that was up 1.3 percent.
The shares had risen 9.3 percent between October and December, lagging a 10.7 percent rise in the benchmark index.
Thu Feb 1, 2007 3:34 PM IST
Source:Reuters India
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