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Shares of Nuvoco Vistas Corporation hit a record low of Rs 398, down 7 per cent on the BSE in Friday’s intra-day trade, after the company reported consolidated loss of Rs 86 crore in December quarter (Q3FY22) due to lower revenue. The cement and cement products company had posted consolidated profit of Rs 44 crore in Q3FY21.
Revenue from operations declined 3 per cent year-on-year (YoY) to Rs 2,165 crore as against Rs 2,231 crore in the corresponding quarter of the previous fiscal. Earnings before interest, taxes, depreciation, and amortization (ebitda) margins also contracted 1,000 bps to 11 per cent from 21 per cent in Q3FY21.
The company said East region was specifically impacted by the unexpected extraneous factors during Q3FY22, which likely drove down the cement demand by around 16 per cent YoY. Late recovery of cement demand (post mid-December 2021) did not allow the opportunity to take price hikes during the quarter. “Q3FY22 witnessed marginal increase in prices; price increase in North and East India were lower than overall price increase on Pan-India basis,” the company said.
However, it expects Q4FY22 to witness strong demand recovery amid potential clinker shortage resulting in opportunity to correct prices. Nuvoco is poised to exploit the market growth, as Q4 is seasonally stronger quarter with robust demand drivers. The aggressive price hikes in key markets to offset input cost increase and expected higher incentive from Jojobera volumes.
Meanwhile, in a separate exchange filing, Nuvoco announced its investments and expansion plans in-line with its business strategy while remaining committed to prioritize deleveraging. Nuvoco has been working on multiple projects for a sustainable growth with an aspiration to diversify its market base and reduce the business risk.
At 01:06 pm, the stock was trading 6 per cent lower at Rs 401, as compared to 1.3 per cent decline in the S&P BSE Sensex. It has fallen below its previous low of Rs 410.05 touched on February 9, 2022. In the past three months, Nuvoco Vistas has underperformed the market by falling 24 per cent, as against 3 per cent fall in the benchmark index. Currently, the stock is trading 30 per cent below its issue price of Rs 570 per share.
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