Key Financial Results (Consolidated Q2 FY27)

  • Cement Sales Volume: 16.5 million metric tons
  • Revenue from Operations: INR 9,197 crores
  • Operating EBITDA: INR 1,271 crores
  • EBITDA Margin: 14%
  • EBITDA per Metric Ton: INR 770
  • PAT: INR 236 crores
  • Net Worth: INR 72,238 crores
  • Cash & Cash Equivalents: INR 1,070 crores
  • Debt Status: Debt-free with AAA/A1+ credit rating

Operational Performance Highlights

  • Trade Volume Growth: Increased 8.6% YoY
  • Trade Share: Increased 6% to 74% of total sales
  • Premium Products: 37% of trade sales (vs 35% last year)
  • Blended Cement Share: Improved from 77% to 82%
  • Ready-Mix Concrete Volume: 1.07 million cubic meters (up 19% YoY)
  • Ready-Mix Concrete Plants: Current network of ~125 plants

Cost Structure Analysis

  • Total Cost per Ton: INR 4,410 (INR 4,182 normalized excluding geopolitical impact)
  • Power Cost: INR 4.8 per unit (vs INR 6.0 in Q2 FY26 and INR 4.3 in Q1 FY27)
  • Green Power Share: 61% of total power consumption
  • Fuel Cost: INR 1.87 per 1,000 kcal (vs INR 1.60 in Q2 FY26 and INR 1.66 in Q1 FY27)
  • Logistics Cost: Moderately higher YoY due to diesel price increases
  • Primary Lead Distance: Reduced from 265 km to 254 km

Major Capacity Expansion Announcement

14 Expansion Projects Adding 30 MTPA Cement Capacity and 10.3 MTPA Clinker Capacity:

West Cluster (15.2 MTPA grinding):

  • Mundra, Gujarat: 2.9 MTPA
  • Hazira, Gujarat: 2.9 MTPA
  • Raigad, Maharashtra: 2.9 MTPA
  • Kalyan, Maharashtra: 2.9 MTPA
  • Amravati, Maharashtra: 2.9 MTPA
  • Dahanu, Maharashtra: 1.0 MTPA (bulk cement terminal)

East Cluster (11.6 MTPA grinding):

  • Rangia, Assam: 2.9 MTPA
  • Hojai, Assam: 2.9 MTPA
  • Godda, Jharkhand: 2.9 MTPA
  • Muzaffarpur, Bihar: 2.9 MTPA

North Cluster (2.9 MTPA grinding):

  • Dadri Line-2, Uttar Pradesh: 2.9 MTPA

New Clinker Capacities:

  • Maratha, Maharashtra: 4.0 MTPA
  • Umrangso, Assam: 4.0 MTPA
  • Mundra, Gujarat: 2.25 MTPA

Capital Expenditure: INR 14,500 crores for the expansion program

Recent Commissioning and Stabilization

  • Commissioned in Q2 FY27: 4.6 MTPA across Dahej (Gujarat), Salai Banwa (UP), Kalamboli (Maharashtra)
  • Stabilized Capacities: 3.2 MTPA across Bathinda (Punjab), Jodhpur (Rajasthan with Penna)
  • Upcoming Commissioning: Warisaliganj, Bihar (2.4 MTPA) in H2 FY27

Corporate Development: Merger Update

  • Proposed merger of ACC and Orient Cement with Ambuja Cements received shareholder support
  • Now proceeding to NCLT for final approvals
  • Expected completion within FY27 (subject to regulatory and NCLT approvals)
  • Expected to be EPS accretive and create "One Cement" platform

FY27 Guidance and Outlook

  • Cost Target: INR 4,250 per metric ton for FY27
  • Volume Growth: Expected to outpace industry in H2 FY27
  • Industry Demand: Expected 6-7% growth for full FY27
  • Company Volume Growth: Targeting higher single-digit to double-digit growth
  • Capex Guidance: INR 6,500-7,000 crores for FY27 (INR 3,500 crores already spent in H1)

Strategic Priorities

1. Premiumization: Focus on trade and premium product mix

2. Operational Efficiency: Manufacturing excellence, energy efficiency, logistics optimization

3. Cost Optimization: Structural cost improvements through various initiatives

4. Capacity Expansion: Brownfield expansion in high-value markets

5. Synergy Realization: Through merger integration and group synergies

Regional Performance Summary

  • North: Led on EBITDA and volume growth with 13% YoY trade volume growth
  • Central: Second highest regional EBITDA with 9% trade volume growth
  • West: 14% trade volume growth and most resilient EBITDA performance
  • East: Maintained trade volumes broadly in line with last year
  • South: 13% YoY trade volume growth with strong sequential recovery

Key Initiatives Driving Efficiency

  • BCFC Infrastructure: Higher utilization for fly ash movement to reduce raw material costs
  • Electric Vehicles: 400 electric vehicles expected to be operational by March 2027
  • WHRS: 18 MW coming up in Sanghi in Q3 FY27
  • AFR: Increased usage of alternative fuels and raw materials
  • Digitalization: Digipin implementation and Cement Intelligent Network Operating Center (CINOC)
  • SLA Implementation: Operational SLAs with vendor partners for new grinding units

Fuel Strategy

  • Domestic Coal Share: >60% of fuel mix
  • Imported Fuel Share: <40%
  • Pet Coke Share: ~10-12%
  • Current Spot Imported Fuel Cost: INR 2.80-2.85 per 1,000 kcal
  • Group Synergies: Long-term fly ash agreement with group thermal power plants (20 million tons tied up)

Additional Revenue Streams

  • Green Power Sales: INR 136 crores revenue (352 million kWh units sold) in Q2 FY27
  • Fly Ash Sales: INR 25 crores revenue in Q2 FY27
  • Combined Contribution: ~INR 97 per ton EBITDA benefit

Tax Rate

Low tax rate in Q2 FY27 due to tax shields from Penna and Sanghi acquisitions, expected to continue post-merger

Capacity Utilization

  • Q2 FY27 Utilization: ~61-62%
  • FY27 Exit Target: ~75%
  • Acquired Assets (Penna, Sanghi): ~50% utilization currently

Challenges and Headwinds

  • Geopolitical conflicts affecting energy costs
  • Higher diesel prices impacting logistics costs
  • Domestic coal availability constraints
  • Monsoon-related headwinds
  • Drought declarations in key states (Maharashtra, Karnataka, Andhra, Rajasthan)