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JK Cement Secures 250 MT Limestone Supply Agreement with GMDC

Written by: Team Angel OneUpdated on: Jan 30, 2025, 2:40 PM IST
JK Cement has signed a long-term agreement with GMDC for a 250 million-tonne limestone supply.
JK Cement Secures 250 MT Limestone Supply Agreement with GMDC
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JK Cement Ltd has taken a strategic step towards reinforcing its market position by securing a long-term limestone supply agreement with Gujarat Mineral Development Corporation Ltd. (GMDC). This agreement follows JK Cement’s successful bid for a 250 million tonne (MT) limestone supply from GMDC’s Lakhpat Punrajpur Mines, situated in Kutch, Gujarat.

A Key Strategic Move for JK Cement

Limestone is a critical raw material in cement manufacturing, and securing a long-term supply provides stability and operational efficiency. By winning the GMDC tender, JK Cement has ensured a reliable high-quality limestone supply, which will support its manufacturing processes and long-term expansion strategy.

This agreement is particularly significant as it aids JK Cement’s consolidation in western India, strengthening its market presence in Gujarat and nearby regions.

JK Cement’s Planned Acquisition of Saifco Cements

JK Cement has announced its intention to acquire a 60% stake in Saifco Cements, marking its entry into Jammu & Kashmir’s cement market. The proposed acquisition, valued at ₹174 crore, includes Saifco’s integrated manufacturing facility located in Khunmoh, Srinagar.

Spanning 54 acres, the Saifco unit has a clinker production capacity of 0.26 million tonnes per annum (MTPA) and a grinding capacity of 0.42 MTPA. The company also holds captive limestone reserves covering 144.25 hectares, with total extractable reserves estimated at 129 million tonnes.

JK Cement has stated that this acquisition is expected to support its presence in the Jammu & Kashmir region, an area with ongoing infrastructure development activities.

Financial Performance Update

JK Cement Ltd reported a decline in consolidated net profits for Q3 of the financial year 2025. The company’s net profit fell by 33.2% to ₹190 crore during the October-December quarter, compared to ₹284 crore in the same period last year.

While total revenues remained largely unchanged, this was attributed to moderate improvement in realisations. The company’s total volumes increased by 13% quarter-on-quarter and 5% year-on-year, despite a subdued demand environment. Meanwhile, realisations rose to ₹4,757 per tonne, compared to ₹4,708 per tonne in the previous quarter.

The company’s EBITDA was impacted primarily due to a muted topline, higher employee benefit costs, and increased freight expenses. Additionally, there was a significant reduction in inventory reversal, amounting to ₹41.15 crore, compared to ₹138.44 crore a year ago.

At 9:39 AM on January 30, 2025, JK Cement shares traded at ₹4,860.80 per share on the NSE.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

Published on: Jan 30, 2025, 2:40 PM IST

Team Angel One

Team Angel One is a group of experienced financial writers that deliver insightful articles on the stock market, IPO, economy, personal finance, commodities and related categories.

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