ACC Reports Significant Growth in Q2FY24 Revenues

ACC, a subsidiary of the Adani Group, has posted robust figures in its quarterly financial results for the July to September 2023 period. The company reported an impressive year-on-year revenue growth of over 11%, soaring to Rs 4,435 crore. The cement maker marks a remarkable shift from the previous year's loss of Rs 87 crore during the same quarter to a profit of Rs 384 crore in this quarter.

The remarkable recovery in profit can be largely attributed to ACC's other income, which witnessed an extraordinary annual increase of over 200%, reaching Rs 210 crore.

While the specific volume data for the September quarter is yet to be disclosed, the company's overall performance has been commendable. Despite missing some earnings targets, including profit, revenue, margin, and EBITDA (earnings before interest, taxes, depreciation, and amortization), ACC has shown significant improvements across all these key financial indicators.

One of the standout highlights of ACC's financial resurgence is its margin performance. In the second quarter of the fiscal year, the company's margin improved by 1200 basis points, rising to 12.4%, compared to a mere 0.4% in the same quarter last year. A concerted effort to reduce costs across various aspects of the business has made the achievement possible.

During the quarter, ACC was able to cut its employee costs by 8% year-on-year, amounting to Rs 195 crore. Notably, power and fuel costs experienced a substantial decline of 33% YoY, reaching Rs 887 crore. Freight and other expenses also dropped by 4% and 8%, respectively, settling at Rs 948 crore and Rs 561 crore.

Furthermore, ACC recently announced the commencement of commercial production of clinker at its integrated plant in Madhya Pradesh, boasting a capacity of 3.3 million tonnes per annum. This development contributed to a 17.3% YoY increase in clinker and cement sales volume, reaching an impressive 8.1 million tonnes.

ACC attributes its remarkable reduction in kiln fuel costs (42% during the quarter) to efficient fuel mix optimization and increased alternate fuel consumption.

Moreover, the company revealed that its Waste Heat Recovery System at Kymore and Jamul, with a total capacity of 22.4 MW, became fully operational during the quarter. Additionally, 16.3 MW at Ametha is expected to be commissioned by the third quarter of 2023-24. ACC anticipates that the share of WHRS in its total power consumption will increase to 9% by the end of FY24, compared to 2.9% in the last quarter.