Ambuja continues strong performance trend with growth plans on track

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Ambuja continues strong performance trend with growth plans on track. Quarter 1, 2021

●        EBITDA increased by 62% with a margin expansion of 540 basis points

●        83% growth in Operating EBIT with EBIT margin expansion of 690 basis points backed by strong growth in volumes and efficiency gains

●        Growth plans are on track. The greenfield integrated plant at Marwar Mundwa to commence operations in Quarter 3, 2021

●        Ambuja ‘Kawach’ has been endorsed globally by the “Solar Impulse Efficient Solution” label, recognizing the Company’s innovative product that protects the environment in a profitable way. Ambuja ‘Kawach’ is the first cement brand from India to be awarded this label.

Mr. Neeraj Akhoury, CEO India for LafargeHolcim and Managing Director & CEO Ambuja Cements Limited said:

As India battles the second wave of COVID, our priority remains safety and well-being of our employees and communities. Health, Cost and Cash continue to be our key focus. Our Business Resilience Team is driving vaccination programs for employees and their families, enforcing prevention guidelines and providing round-the-clock healthcare support. We are determined to do everything that is possible to keep people safe and healthy.

Ambuja registered a strong performance in the first Quarter of 2021 with 83% growth in operating EBIT and 690 basis points expansion in EBIT margin. Despite strong and continuing headwinds on input prices including coal, petcoke and diesel, we have made significant progress on efficiency improvement that has had a positive impact on cost evolution.

India demand growth has been strong in the last quarter which has also helped the sales volume growth and commercial performance. We are also proud to witness that Ambuja’s special products (created jointly with LafargeHolcim global R&D center and adhering to world-class sustainability standards) were able to record solid growth. Synergies under the master supply agreement with ACC continue to be strongly positive for both companies.

Our ambitious growth plans to increase capacities in India are progressing well. Our upcoming facility in Marwar Mundwa, Rajasthan will enhance clinker capacity by 3 MTPA and help improve cement sales by 5 MTPA. We are progressing on our ambition to reach 50 million tons in the mid-term.

We remain focused on our sustainability goals and have improved our performance across key levers of carbon emissions, water consumption, use of alternative fuels and alternate raw materials and co-processing of waste. Going forward, we aim to maintain the momentum on our strategic priorities under the key levers of Growth, Competitiveness, Innovation & Digitalisation and Sustainability”.

COVID-19 update

The second wave of COVID-19 in the country is being tackled very proactively by the company. We are ensuring strict adherence to government guidelines across all our plants and offices. We have put in place a 24X7 COVID-19 crisis control room and are facilitating vaccination for all eligible employees and their families. We are closely monitoring the situation and will continue to take all necessary actions to ensure the health and safety of our employees and communities. Our Plants are continuing to operate under strict COVID protocols.

Financial performance for the quarter ended 31st March 2021

Net Sales during the quarter stood at ₹ 3,579 Crore compared to ₹ 2,760 Crore in the corresponding quarter of the previous year, resulting in a growth of 30%. Special products volume grew at 82% compared to the same period last year.

Total operating cost per ton declined by more than 5% led by operational efficiency programs in the plants along with logistics efficiencies such as direct dispatches, reduction in lead and increased home market sales. These initiatives have compensated for the impact of rising fuel and raw material costs, which continues to be a matter of attention for the coming quarters.

EBITDA during the quarter at ₹ 977 Crore showed a growth of 62% and Operating EBIT at ₹ 851 Crore showed a robust growth of 83%.

Our Greenfield expansion project at Marwar Mundwa is planned to commence operations in Quarter 3, 2021. 

Consolidated unaudited financial results for the quarter ended 31st March 2021

●        EBITDA up by 54.3%

●        Margin expansion for the quarter up by 470 basis points

●        Growth in Operating EBIT is 75.4%

Performance of ACC Limited, a Material Subsidiary

Net Sales during the quarter increased to ₹ 4,213 Crore compared to ₹ 3,433 Crore last year, resulting in a growth of 23%. Profit after Tax was up 74% versus previous year. EBITDA during the quarter is higher by 47% vs previous year at ₹ 860 Crore and EBITDA margin for the quarter expanded by 330 basis points vs previous year. The company also saw strong delivery on account of premium products.


India’s GDP is estimated to grow at around 10.5% for the year April 2021 to March 2022. Though the second wave of pandemic warrants caution, the increased vaccination drive combined with the various stimulus proposals provided in the Union Budget 2021 and accommodative monetary and fiscal policies are expected to support economic recovery in the medium term. Rural demand is likely to remain resilient on a good projection for the agriculture sector. We would like to remain cautiously optimistic for the year.

Business Gujarat News

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