Shree Cements

The day the company announced its Q4 numbers for year ended 30th June 2012, the stock had hit a new 52-week high. The numbers were much higher than expected, infact turned out to be quite a blockbuster.  YoY, the company posted a whopping 538% jump in net profit at Rs.351 crore on a 41% rise in net sales at Rs.1455 crore.  One could say that YoY, the numbers look great due to the base effect as Q4 of previous year was not too enthusing plus the current fiscal is 15 months and not 12 months. So if one looks at the sequential performance, it still comes out smelling of roses as QoQ net profit has risen 209%.   For the year ended 30th June 2012, on a 71% rise in net sales, its net profit was at Rs.618 crore, up 3 times.

Both its units – cement as well as power did very well. Cement recorded a YoY 39% rise in revenue and  EBIT rose 88%. Power showed a 81% rise in revenue  and from a loss of Rs.80 crore in Q4, it posted a EBIT in the current Q4 at Rs.65 crore.  Its total debt as at 30th June 2012 stood at Rs.961 crore.  The CCI has imposed a fine of Rs.397.51 crore on the company and the company is contesting this fine and not provided for. If it had, it would have eaten away the entire net profit of Q4 and more, pushing the company into the red.  Shree Cement has the largest single-location integrated cement plant in North India located in Rajasthan with an installed capacity of 13 million tonne. While North accounts for 72 per cent of its volumes, the rest is from the central India.