Shares of this smallcap company surged around 12 percent in Monday’s trading session after announcing the commissioning of an additional 2.50 million tonnes per annum (MTPA) cement grinding capacity at Udaipur, Rajasthan. The shares have delivered around 70 percent returns to its shareholders in one year.
With a market capitalisation of Rs. 2,096 crores, the shares of Udaipur Cement Works Ltd (UCWL) started Monday’s trading session on a higher note at Rs. 35.75 compared to its previous close of Rs. 33.55. During the trading session, the shares hit a high of Rs. 37.60, gaining around 12 percent and are currently trading at Rs. 37.31 apiece.
Such a bullish movement in the share price was observed after the company in an exchange filing announced that they had commissioned an additional 2.50 million tonnes per annum (MTPA) cement grinding capacity at Udaipur, Rajasthan. With this, the company has doubled its Clinker Capacity to 3 Million Tonnes per annum.
This expansion enables UCWL to address the increasing market demand for cement products, ensuring a consistent supply to meet the needs of customers in the region and beyond.
Earlier in October 2023, Udaipur Cement commissioned an additional clinker line of 1.50 Million Tonnes Per Annum whereby the company’s Clinker Capacity was doubled to 3.00 Million Tonnes Per Annum from 1.50 Million Tonnes Per Annum.
Furthermore, the company highlighted that last year, they had installed a first of its kind in the state of Rajasthan and the only one in the entire Indian Cement Industry a Floating Solar Power Plant of 1 MWp at its mines.
Moreover, during the previous quarter, the company also doubled its Waste Heat Recovery Power Capacity from 6 MW to 12 MW. This has enabled UCWL to achieve a Green Energy share of more than 50 percent in total electrical energy consumption.
Coming onto the company’s financial statements, the revenue increased by 12 percent from Rs. 269 crores during the September quarter to Rs. 300 crores in the December quarter. In addition, the net profits magnified by 191 percent from Rs. 12 crores to Rs. 35 crores during the same period.
Due to increasing expenditure, the profitability metrics of the company declined with the return on equity (RoE) decreasing from 13.82 percent during FY 21-22 to 7.03 percent in FY 22-23, and, the return on capital employed (RoCE) showed a downward movement from 3.40 percent to 1.99 percent during the same timeframe. Furthermore, the net profit margin decreased from 5.55 percent during FY 21-22 to 3.47 percent during FY 22-23.
Headquartered in Rajasthan, Udaipur Cement Works was incorporated in 1993. The company presently is a subsidiary of the Indian Cement Manufacturing company, JK Lakshmi Cement Limited. UCWL is specialized in the production and supply of cement and cementitious products.
Written By Vaibhav Patil
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