HomeBricks & MortarCementJK Lakshmi Cement Posts Rs 19.24 Crore Loss in Q2 FY25

JK Lakshmi Cement Posts Rs 19.24 Crore Loss in Q2 FY25

JK Lakshmi Cement has posted a net loss of ₹19.24 crore for Q2 FY25, a sharp contrast to the profit recorded in the same quarter last year. This setback is part of a broader trend across the cement industry, where many manufacturers faced a challenging environment due to weak demand and falling prices. While larger players like UltraTech Cement, Ambuja Cement, and Dalmia Bharat have reported positive growth, smaller players, including JK Lakshmi Cement, Birla Corporation, and HeidelbergCement, saw declines in both topline and sales volume during the September quarter.

The industry’s struggles were primarily driven by a combination of factors, with the prolonged monsoon season and floods affecting construction activity, and a slow pick-up in government infrastructure projects. Cement prices, which had been steadily rising until June 2024, dropped by 11% year-on-year to ₹330 per 50 kg bag by September 2024, contributing to a reduction in sales realisation. The impact was most acute in the southern and eastern regions, where prices fell by as much as 10-12% year-on-year. For JK Lakshmi Cement, despite a slight increase in net sales realisation, which rose by 0.8% on a quarter-on-quarter basis to ₹4,708 per tonne, the overall sales volume remained subdued. The broader market sentiment was similarly grim, with other smaller players such as Nuvoco Vistas and HeidelbergCement also facing difficulties due to declining prices and reduced volumes.

However, despite these setbacks, industry leaders remain cautiously optimistic about the second half of the fiscal year. The expected improvement in cement demand, driven by government infrastructure projects and a revival in housing demand, could offer some respite. Yet, there is a growing concern about how cement manufacturers will continue to balance the need for price stability with their commitment to sustainable production. From a sustainability perspective, the pressure on margins could force companies to reconsider their green initiatives. Rising costs and environmental responsibilities will need to be carefully balanced in order to ensure long-term profitability without compromising on eco-friendly practices, a critical aspect as the industry faces growing scrutiny from regulators and the public.

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