The Ramco Cements Ltd on Thursday (November 5) reported a 9% year-on-year decline in net profit to ₹71 crore, compared with ₹78 crore in the corresponding quarter last year. Revenue increased 10% to ₹2,463 crore from ₹2,239 crore.
It reported a 15.8% year-on-year decline in EBITDA to ₹326 crore for the second quarter of FY27, compared with ₹387 crore in the year-ago period, as higher fuel and packing material costs linked to the West Asia conflict weighed on operating performance. The EBITDA margin contracted to 13.2% from 17.3%.
Cement sales volume rose 8% to 4.74 million tonnes in Q2FY27 from 4.4 million tonnes a year earlier, despite monsoon-related demand disruptions in Kerala, Karnataka, Odisha and West Bengal. Cement capacity utilisation stood at 72%, compared with 71% in Q2FY26.
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The construction chemicals business recorded a 38% increase in sales volume to 2.04 lakh tonnes from 1.48 lakh tonnes. Net revenue from the business grew 50% to ₹130.77 crore from ₹87.26 crore. Blended EBITDA per tonne of cement declined to ₹669 in Q2FY27 from ₹866 in the year-ago quarter. The EBITDA ratio stood at 13%, compared with 18% in Q2FY26.
Higher fuel, packing costs weigh on margins
The company said the increase in fuel and packing material costs was linked to geopolitical disruptions in West Asia. Blended fuel consumption cost per tonne of cement increased to $140 in Q2FY27, with a cost per kilocalorie of ₹1.99, from $122 and ₹1.49 per kilocalorie, respectively, in Q2FY26. Fuel costs were also adversely affected by a 10% year-on-year depreciation in the rupee.
Power and fuel cost per tonne of cement rose to ₹1,397 from ₹1,029 in the year-ago quarter, primarily due to higher imported fuel costs and freight rates amid geopolitical disruptions in West Asia. Domestic diesel prices increased 6% year-on-year, while polymer prices rose 43%, adding to packing and forwarding costs.
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Green energy usage improved to 50% in Q2FY27 from 48% a year earlier, following the addition of waste heat recovery system (WHRS) capacity at RR Nagar during the previous year.
The company also incurred a variable cost impact of ₹33 crore, equivalent to ₹69 per tonne of cement, during the quarter due to Tamil Nadu’s Mineral Bearing Land Tax on limestone. The state government had imposed a levy of ₹160 per tonne of limestone from April 4, 2025, and the company expensed it up to August 21, 2026, in the relevant periods.
Ramco Cements said it believes the tax is no longer payable under the Mines and Minerals (Development and Regulation) Amendment Act, 2026, which came into effect on August 22, 2026.
However, as the Tamil Nadu Government’s Mineral Management System (MIMAS) portal for issuing limestone transport permits has not been updated, the levy remains disputed and the company continues to pay it under protest.
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The ₹8.61 crore remitted towards the levy between August 22 and September 30, 2026, has not been recognised as an expense. The company and other cement producers have represented the matter to the Tamil Nadu government, and the issue is pending.
Interest cost declines
Interest cost declined to ₹93 crore in Q2FY27 from ₹111 crore in Q2FY26, following repayment of borrowings during the previous year. Depreciation increased to ₹190 crore from ₹182 crore, due to the commissioning of facilities such as the WHRS at RR Nagar and the railway siding at Kolimigundala during FY26.
The company earned a profit of ₹5 crore from the sale of surplus land during the quarter, which was recognised under exceptional items. Profit before tax, including exceptional items, stood at ₹52 crore, compared with ₹100 crore in Q2FY26.
Capacity expansion and capital expenditure
Ramco Cements completed debottlenecking activities at Jayanthipuram during Q2FY27, increasing capacity by 0.73 million tonnes per annum (MTPA). Its total cement capacity now stands at 27.17 MTPA.
The company plans to increase cement capacity to around 31 MTPA by March 2027, following the commissioning of Line 2 at Kolimigundala. The 3.15 MTPA clinkering unit at Kolimigundala is expected to be commissioned ahead of schedule by December 2026.
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A 15-megawatt WHRS facility is also expected to be commissioned at Kolimigundala along with Line 2, which would increase the company’s green power generation potential.
The company has proposed setting up a construction chemicals manufacturing unit at its Kolimigundala plant, with an annual production capacity of 1.2 lakh tonnes. The project is estimated to cost ₹20 crore and is expected to be completed by Q2FY28.
Ramco Cements incurred ₹197 crore in capital expenditure, including maintenance capex, during Q2FY27. Its capital expenditure guidance for FY27 stands at ₹800 crore.
The company’s total debt stood at ₹3,963 crore as of September 30, 2026, compared with ₹3,852 crore as of March 31, 2026. The cost of debt was 7.04% in Q2FY27, against 7.18% in Q2FY26.
Ramco Cements said its construction chemicals business continues to pursue a strategy of offering the right products for the right applications while strengthening its brand equity. It also said Tamil Nadu is the only state to have imposed such a high Mineral Bearing Land Tax levy.
Shares of Ramco Cements Ltd ended at ₹814.20, up by ₹42.55, or 5.51%, on the BSE.