BENGALURU, Oct 19 (Reuters) – India’s top cement maker UltraTech Cement (ULTC.NS) on Wednesday reported a bigger-than-expected drop in September-quarter profit, dented by higher power and fuel costs as well as lower demand.

Consolidated net profit for the quarter was at 7.56 billion Indian rupees ($91.77 million), down over 42% on year.

Analysts, on average, had expected the company to report a profit of 8.58 billion rupees for the latest quarter, according to IBES data from Refinitiv.

Total expenses for the quarter surged 26.7% due to higher global petcoke and coal prices, with power and fuel expenses rising above 70%.

“Demand was low during July and August, showing some sign of revival in September,” the company said in a statement, adding that second quarter is traditionally weak due to lower construction activity on the back of monsoon rains.

“Pick-up in retail demand (in September) was on the back of pent-up demand accumulation during the monsoons, pre-Diwali construction and repair work gaining momentum.”

Consolidated net sales in the September-quarter rose about 16% to 135.96 billion rupees from a year ago.

Earlier this week, rival ACC Ltd (ACC.NS) had reported a surprise quarterly loss, also hit by higher energy costs. read more

Competition in domestic cement industry got heated after UltraTech Cement in June charted out a plan to increase its annual capacity to 159.25 million tonnes per annum to stave off competition from the sector’s newest entrant Adani Group. read more

Indian ports-to-energy conglomerate Adani Group recently concluded acquisition of ACC after it ventured into cement making earlier this year with its $10.5 billion acquisition of Holcim AG’s (HOLN.S) cement businesses in India – Ambuja Cements Ltd (ABUJ.NS) and ACC.

($1 = 82.3825 Indian rupees)

Reporting by Nallur Sethuraman in Bengaluru; Editing by Neha Arora

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