Ambuja Cements today reported over 17 per cent rise in net profit at Rs

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302.40 crore for the fourth quarter ended December 2011, on account of higher sales.

It had registered a net profit of Rs 258.12 crore in the same quarter last year.

Net sales of the company in which Swiss major Holcim has majority stake, rose to Rs 2,329.11 crore in quarter under review against Rs 1,788.47 crore in the year-ago period.

For the full year, Ambuja Cements' net profit was down by 2.8 per cent to Rs 1,229 crore against Rs 1,264 crore in 2010.

"Profit after tax stood at Rs 1,229 crore, marginally lower by 2.8 per cent year-on-year, mainly on account of one time charge arising out of change in method of valuation of ESOP cost and due to increased tax charge," the company said in a statement.

The company had recently changed the measurement method of compensation cost relating to employees stock option from intrinsic value to fair-value method for all outstanding ESOPs at the beginning of the year. This costed the company Rs 33.21 crore.

Net sales of the company rose to Rs 8,515 crore compared to Rs 7,390 crore a year ago.

Ambuja Cements sold 20.91 million tonnes cement in 2011, which is 4.5 per cent more than what it had sold in 2010. It produced 20.97 million tonnes cement during the year.

It said government's thrust on infrastructure along with expected policy reforms, lower inflation and interest rates might boost demand in the current year.

"Cost pressure due to rising cost of energy, logistics and raw materials may continue to impact margins. ACL as a company is focused on improving operational efficiency and productivity to mitigate cost pressures," it said.

Prices are expected to remain volatile in the short-term due to demand supply imbalances, it added.