Chennai, Nov 9 (PTI): India Cements Friday said it would set up a manufacturing facility in Madhya Pradesh at an investment of around Rs 1,000 crore following the agreement it signed to acquire Springway Mining Pvt Ltd last month.Also Read - Viral Video: After Man Refuses to Take Covid Vaccine, Here's What His Friends Did Next | Watch

The city based company,which has manufacturing facilities across the country, recorded capacity utilisation increase at 77 per cent for the quarter ending September 30, 2018, company Vice-Chairman and Managing Director, N Srinivasan said. Also Read - Horrific! Couple Abducted From Delhi, Killed In MP, Bodies Dumped In Different States, Say Police

He said the company entered into a share purchase ageement to acquire the entire share holding of Springway Mining Pvt Ltd in a phased manner for Rs 182.89 crore. Also Read - Madhya Pradesh Govt Allows Schools to Reopen from This Date As Covid Cases Dip | Deets Inside

“Investments will be around Rs 1,000 crore for setting up the cement plant. We will fund it internally. If necessary, we may go for a bridge loan”, he told reporters.

To a query, he said the manufacturing unit would serve the North and Eastern Uttar Pradesh markets.

Srinivasan and senior executives were here to declare its financial performance for the quarter and half year period ending September 30, 2018.

India Cements reported a 93.95 per cent drop in its standalone net profit at Rs 1.43 crore during the quarter ended September 2018 due to low selling price, despite an increase in volume.

The company had reported a net profit of Rs 23.67 crore in the same quarter of the previous fiscal.

Total income stood at Rs 1,390.84 crore in the second quarter of the 2018-19 fiscal. It was Rs 1,274.9 crore in the year-ago period, India Cements said in a BSE filing.

The company

The company said due to introduction of GST from July 1, 2017, as excise duty is subsumed under GST,the total income and expenditure from July 1, 2017 are net of GST and hence not comparable.

Expenses during the quarter under review were Rs 1,389.41 crore, compared to Rs 1,238.7 crore in the corresponding period a year ago.

Srinivasan said despite recording an increase in plant capacity, the net profits were impacted due to low selling price and fuel costs.

“Net plant realisation for the second quarter dropped to Rs 3,347 as against Rs 3,473 registered in the same period of last year. Variable costs had gone up by eight per cent on year-on-year basis and by two per cent as compared to quarter on sequential basis”, he said.

Despite the drop in the net plant realisation for cement and impact of the Dollar appreciation on import bills, the company achieved a reasonable performance through increased volume.

The tough cement market conditions in South India,arising out of regional imbalances in capacity, coupled with a steep increase in fuel price and depreciation of the Rupee against the Dollar had an impact on the operating performance of the company during the period under review, he said.

Cement sales for the quarter under review was 30.10 lakh tonnes, up by 11 per cent and with clinker sales of 0.67 lakh tonnes, the overall volume was 30.77 lakh tonnes.

This is published unedited from the PTI feed.