The change took effect from August 22, 2026, following the enactment of the Mines and Minerals (Development and Regulation) Amendment Act, 2026.
Under the amended law, states face restrictions on imposing taxes or other levies on mineral rights and mineral-bearing land, except under conditions prescribed by the central government.
The change is significant for cement manufacturers because limestone is the principal raw material used to make cement. A levy charged on every tonne of limestone therefore directly adds to the cost of producing cement.
Ramco Cements had been paying ₹160 per tonne of limestone as Mineral Bearing Land Tax in Tamil Nadu. The company paid ₹171.78 crore towards the tax in FY26 and another ₹79.07 crore in FY27 so far.
To put the potential saving in perspective, the ₹171.78 crore paid in FY26 was equivalent to more than five times the company’s ₹32 crore standalone net profit reported in the latest quarter. While the eventual annual benefit will depend on limestone volumes and other factors, the previous year’s tax outgo gives an indication of the size of the cost that is now being removed.
With the levy now ending, Ramco Cements expects its operating costs to come down by a similar amount, which should have a positive impact on profits and cash flows.
How did Ramco Cements perform in Q1?
The development comes after Ramco Cements reported a sharp fall in profit for the April-June quarter.
Standalone net profit fell 62.8% year-on-year to ₹32 crore from ₹86 crore a year earlier. The figure was, however, higher than the ₹25 crore estimated in a CNBC-TV18 poll.
Revenue rose 9.6% to ₹2,269 crore from ₹2,070 crore in the year-ago quarter, also beating the CNBC-TV18 poll estimate of ₹2,210 crore.
EBITDA fell 22.7% to ₹307 crore from ₹398 crore a year earlier, but was slightly ahead of the ₹305 crore poll estimate.
The company attributed the weaker operating performance to higher fuel and packing material costs following the West Asia war, along with a 5% year-on-year decline in realisation.
The removal of the limestone levy may not address all of these pressures, particularly fuel costs and weaker realisations, but it removes one direct raw-material-related expense from the company’s cost structure.
Ramco Cements shares closed 1.11% higher at ₹909 on the NSE on August 24, gaining ₹9.95 during the session.
Also Read: Ramco Cements, Dalmia Bharat to gain from mining law change: HDFC Securities
