Sagar Cements is focussed on improving the overall efficiency and utilisation levels of its recently acquired units, according to Joint Managing Director, Sreekanth Reddy.
“The Jeerabad and Jajpur units are performing in line with our expectations. The Mattampally plant was operated at 52 per cent utilisation, and the Gudipadu, Bayyavaram, Jeerabad, Jajpur and Dachepalli plants at 89 per cent, 59 per cent, 81 per cent, 14 per cent and 6 per cent respectively, during the quarter,’’ Reddy said.
While the ramp-up at Jeerabad is almost complete, the Hyderabad-based Sagar is “confident’’ of a break-even at Jajpur in the current year.
“Earlier, we thought it would take longer, but I think the ramp-up at Jajpur is taking shape. And we are very happy that the clinker has stabilised at Andhra Cement’s Dachepalli unit. We are almost at 80 per cent of the rated output, and it is hitting historically high numbers,’’ he said.
Reddy said the industry in general witnessed ‘good’ volume growth during the first quarter on the back of steady demand from both the housing and infrastructure segments.
Input prices, as well, continue to trend lower, auguring well for business. “Higher utilisation levels amidst steady demand, coupled with lower input prices, should help improve overall profitability over the coming quarters,’’ he added in the earnings call.
Sagar Cements posted a net loss of Rs 42 crore in the first quarter ended June 30, 2023. In the corresponding quarter of the previous financial year, it incurred a loss of Rs 13 crore.
The total revenue of the Hyderabad-based company declined by 5 per cent at Rs 543 crore (Rs 570 crore). The first quarter performance was largely impacted owing to the maintenance shutdown for Matampally’s line-II clinker production, coupled with the competitive pricing environment across its markets.
