UPDATE: Holcim's India Units Post Better-Than-Expected April-June Net Profit

--ACC net profit up 26% at 4.15 billion rupees; Ambuja up 35% at 4.69 billion rupees

--Sales at ACC up 15%, at Ambuja about 18% higher

--Net profit, sales at both companies beat market estimates

--Higher costs, freight rates to put pressure on margins in future, says Ambuja

(Merges two earnings announcements, adds details throughout)

 
   By Anirban Chowdhury 
 

MUMBAI--Swiss cement maker Holcim Ltd.'s (HOLN.VX) two Indian units -- ACC Ltd. and Ambuja Cements Ltd. -- Thursday posted better-than-estimated quarterly net profit numbers, on higher product prices and strong sales.

ACC Ltd. (500410.BY) recorded a consolidated net profit of 4.15 billion rupees ($74.73 million) in the April-June period, up 27% from a year earlier, while Ambuja Cements Ltd. (500425.BY) said its net profit grew 35% to 4.69 billion rupees.

Sales at ACC rose 15% to 29.19 billion rupees while Ambuja posted an increase of 18% to 25.66 billion rupees.

Six analysts had on average expected ACC to post a net profit of 3.66 billion rupees on sales of 27.28 billion rupees in a Dow Jones Newswires poll. Five had expected Ambuja to post a net profit of 4.54 billion rupees on sales of 25.43 billion.

The April-June quarter has been good for Indian cement companies as sales volume of building materials has risen thanks to a revival in demand from the construction sector.

Prices have also been increased, but largely to offset higher costs of production and transportation.

Last week, competitor UltraTech Cement Ltd. posted a 14% rise in its net profit, beating market estimates.

ACC's cement sales grew 2% to 6.05 million tons, while volumes for Ambuja grew 7.3% to 5.54 million tons.

Major input costs such as ash and powder continued to increase, as did transportation costs due to a sharp hike in railway freight rates ACC said in a statement.

ACC spent 4.15 billion rupees on raw materials during the quarter, up 9% on year. for Ambuja, raw material costs grew 19% to 1.75 billion rupees.

The rising costs are expected to put profit margins under pressure in future quarters, Ambuja said in a statement.

Write to Anirban Chowdhury at [e-mail]

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