The financial performance of the listed steel and cement manufacturers in the July-September quarter is building up a case that an economic bounce back to pre-pandemic level is certainly in the works.
Of the five listed steel makers, four have disclosed their numbers for the first quarter of their 2020-21 financial year and three are back in the black.
Similarly, of the seven cement makers, four have unveiled their figures for the quarter and all have beaten last year’s numbers.
All steel and cement makers reported losses in their last financial year that ended on June 30 thanks to the absolute tailspin in sales brought about by the countrywide general shutdown enforced by the government from March 26 to May 30 to flatten the curve on coronavirus.
The shutdown had brought all economic activities, especially construction works, to a grinding halt.
Take the case of BSRM, the market leader in the steel sector. Its profit for the quarter stood at Tk 33.6 crore, up 39.4 per cent year-on-year.
Its sister concern BSRM Steels staged an even stronger turnaround: its profits soared 1.5 times from a year earlier to Tk 35.8 crore.
Tapan Sengupta, deputy managing director of BSRM, credited the improved performance on pent-up demand from the lockdown, which saw muted activities in private construction, real estate and infrastructure sectors.
Similarly, GPH Ispat’s profit was up 67.7 per cent year-on-year to Tk 27.5 crore between July and September.
GPH Ispat’s 67.51 per cent. Besides, RSRM’s losing in the period at Tk 10.72 crore, which profit at Tk 5.5 crore in the same period of the preview’s year.
Kamrul Islam, director of finance at GPH Ispat, echoed the same as Sengupta.
“Consumers could not place orders or buy during the shutdown. Besides, infrastructure works were on hold. They bought our products in the July-September period,” he said.
RSRM though posted a loss.
Sengupta feels sales will stage a proper rally if there is no second wave of Covid-19 cases.
The cement makers too saw a rebound after a washed-out April-June quarter, led by Premier Cement, whose profit shot up a whooping 95.5 per cent to Tk 8.6 crore in the three months to September.
LafargeHolcim Bangladesh registered a 31 per cent increase in profit in the July-September quarter. Its sales during the quarter edged up 3 per cent to Tk365.5 crore.
“Our efforts on health, cost and cash have ensured that we stay focused during the crisis while our fast progress on digital helped us being effective in the market place,” said Rajesh Kumar Surana, chief executive officer and country representative of LafargeHolcim.
Similarly, Meghna Cement’s net profit surged 32.8 per cent year-on-year to Tk 1.3 crore during the quarter.
HeidelbergCement Bangladesh, one of the largest manufacturers of top-quality cement in Bangladesh, narrowed its losses during the quarter: it stood at Tk 2.7 crore, down from Tk 14.3 crore a year earlier.
The company, whose brands include Ruby Cement and Scan Cement, announced no dividend for its last financial year, a first since its listing in 1989.