Cement maker ACC beats Q3 profit estimates on price hikes, strong demand

BENGALURU, Jan 25 (Reuters) - Cement maker ACC reported a higher-than-expected third-quarter profit on Thursday, helped by price hikes and strong demand for construction materials.

The Adani Group-owned company's profit after tax surged nearly five-fold to ₹527 crore ($63.4 million) in the three months ended 31 December, surpassing average analysts' estimates of ₹415 crore.

As per experts, cement prices in India rose 2.5% sequentially, which helped cement makers like ACC earn more from sales.

The makers have also been benefitting from a demand surge from the housing and infrastructure sectors, further aided by the government's spending push.

The company's revenue from operations climbed more than 8% to ₹4,918 crore, helped by a 17% year-on-year growth in cement and clinker sales volumes. Consensus market expectation was 5-11% growth during the quarter.

ACC's power and fuel costs dropped 10%, leading to a 1.5% slip in total expenses.

"Opportunity buy low-cost petcoke will help to further optimise fuel costs in the coming quarters," the company said in a statement.

Price hikes and sustained infrastructure demand helped larger rival UltraTech Cement post third-quarter profit and revenue above estimates last week. Meanwhile, the company's share rose 5.5% after the result announcement.