Ambuja Cement profit plunges 90% to 236 crore rupees in September quarter
Key Facts
Ambuja Cement’s consolidated net profit fell 90% year on year to 236 crore rupees in the September quarter of 2026, Business Standard reported, citing PTI. The sharp decline came as revenue from operations rose just 0.2% to 9,197 crore rupees, while earnings before interest, tax, depreciation and amortisation fell 27.9% to 1,271 crore rupees. The figures show a gap between nearly steady revenue and weaker operating profitability in a quarter that also saw cement sales decline. The year-on-year comparison for net profit was affected by a high base, as the previous year’s profit included a large tax item.
Profit in the corresponding period a year earlier was 2,336 crore rupees and included a reversal of an income tax provision worth 1,697 crore rupees, according to the report. The September-quarter figure is therefore being compared with a previous profit that included that reversal, explaining part of the steep reported decline. At the same time, operating results point to pressure beyond the base effect: operating profit fell even as revenue was nearly unchanged. In the first quarter of fiscal 2027, the company posted revenue of 9,500 crore rupees, earnings before interest, tax, depreciation and amortisation of 1,589 crore rupees, and profit after tax of 660 crore rupees, according to an Adani Group update. Those figures provide a recent comparison with the second quarter, when revenue and operating profit were below first-quarter levels.
Cement sales fell 0.6% year on year to 16.5 million tonnes in the September quarter, Business Standard reported. Earnings before interest, tax, depreciation and amortisation per tonne declined to 770 rupees from 1,061 rupees in the corresponding period a year earlier. The operating margin also narrowed to 13.8% from 19.2%. The metrics combine a slight decline in sales volumes with a larger drop in operating returns per tonne, alongside a narrower margin. Nearly steady revenue therefore coincided with weaker operating profitability at both company and per-tonne levels.
The company attributed pressure on earnings to higher petcoke and coal prices, tight coal supplies, and increased diesel and packaging costs, according to the report. It also cited geopolitical uncertainty and pressures related to the monsoon season. In its first-quarter update, Ambuja said higher fuel and logistics costs linked to geopolitical developments in West Asia had weighed on results, while sequential cost reductions and improved operating efficiency supported profitability. In the second quarter, the cost pressures cited by the company coincided with lower operating earnings per tonne and a narrower year-on-year margin. Total cost was 4,410 rupees per tonne during the quarter, according to Business Standard.
On the sales mix, commercial sales volumes rose 8.6% year on year and accounted for 74% of total volumes, up six percentage points. Premium products’ share of commercial sales increased to 37%, from 35% in the corresponding period a year earlier. The figures show improved growth in commercial sales and a higher share of premium products alongside a 0.6% decline in total cement sales volume. The company said managing institutional volumes, together with strong commercial sales, would support volume growth in the coming period. These indicators place the sales mix among the elements of the company’s plan to sustain growth, as quarterly results showed a decline in returns per tonne and margins.
The company is expanding production capacity while pursuing cost reductions. It commissioned 4.6 million tonnes a year of capacity during the September quarter, while production from 3.2 million tonnes a year is being stabilised and ramped up, according to the report. It expects to commission an additional 2.4 million tonnes a year in the second half of fiscal 2027. The company’s first-quarter update had said it aimed to increase cement production capacity from 109 million tonnes a year to 119 million by the end of fiscal 2027. The commissioned additions and capacity being ramped up form part of that plan, along with capacity expected to come online in the second half.
Ambuja said it expects its volumes to grow faster than the sector in the second half, supported by higher commercial sales and management of institutional volumes. It also reaffirmed its cost-reduction target of 4,250 rupees per tonne by the end of fiscal 2027, compared with total costs of 4,410 rupees per tonne in the September quarter. Across the sector, cement production in India rose 12.5% year on year in August 2026, according to government estimates, while the average bag price remained near 330 rupees that month, unchanged from July, according to Financial Express. The newspaper estimated that demand grew at a mid-single-digit pace in August, with demand varying across regions. During the earnings season, Shree Cement’s profit fell 26%, according to a report published by EL7.AI, while another report by the platform said ACC’s profit fell 91% amid higher fuel costs and weak sales.