Shares of Ramco Cements plunged nearly 10 percent on Thursday, November 11 after the company reported a 99.4 percent decline in the quarterly net profits at Rs. 3.08 crore in the quarter that ended September 2022.
During Thursday’s trade, the stock opened at a price of Rs. 689 per share against the previous close of Rs. 704.45 and dipped further to touch an intraday low of Rs. 634.05 per share. At 11:15 am, it was trading at Rs. 649, down by 8.69 percent on the NSE.
The stock touched a 52-week-high of Rs. 1,119.60 on November 8, 2021 and a 52-week-low of Rs. 575.65 on June 20, 2022, indicating that at the current level, the stock is trading at just 10 percent above its 52-week low and over 43 percent below its 52 week high.
On Wednesday, Ramco Cements reported a 99.28 percent decline in consolidated net profit at ₹3.71 crore for the September quarter 2022-23 on account of a sharp rise in fuel prices and weak cement rates, reported PTI.
The company logged a net profit of ₹516.77 crore in the July-September quarter last year. Total income was up 19.21 percent to 1,800.61 crores as against ₹1,510.33 crore in the corresponding period of the previous fiscal year.
Ramco Cements' earnings per share (EPS) dropped from Rs. 23.00 in September 2021 to Rs. 0.13 in September 2022. In September 2022, EBITDA was Rs. 194.59 crores, down 52.19% from Rs. 407.01 crore in September 2021.
The company has cited a sharp increase in fuel prices and weak cement prices as the main cause of weak profits. The company could not pass on the full cost increase arising out of the sharp fuel price hike, to its customers, it said in a statement.
On another note, the board of the company has approved a proposal for establishing a new line at its grinding unit in the Jajpur district, Odisha.
"The capacity of Line ll would be 0.90 million tonnes per annum capacity and is proposed to be established at a cost of ₹130 crore. Upon commissioning, the cement manufacturing capacity of the Haridaspur grinding unit would increase to 1.80 million tonnes per annum," the official statement said.
The Ramco Cements Ltd., established in 1957, is a large-cap company with a market capitalization of ₹17,464.37 crore operating in the cement industry. It is a part of the Ramco Group, a business group based in Chennai, India. Ramco Cements has 5 integrated cement manufacturing units, 6 grinding units, and 1 packing terminal across India.
According to a Mintgenie poll, an average of 32 analysts have a ‘HOLD’ call on the stock.