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Informist, Friday, Jul. 31, 2026

 

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--Shree Cement:Used low quality coal Q1 as contracted pet coke did not reach 
--CONTEXT: Shree Cement mgmt's comments in post-earnings analyst call 
--Shree Cement: Fuel costs have almost peaked, should stabilise here on 
--Shree Cement: Focusing on profitability instead of volumes 
--Shree Cement: Expect 19.5 mln 20 mln tn volumes in Apr-Sept 
--Shree Cement: Retain FY27 volume guidance of 40 mln tn 
--Shree Cement: North region capacity utilisation was 66% in Apr-Jun 
--Shree Cement: Retain FY27 capex guidance of INR 15 bln 
--Shree Cement: Incurred capex of over INR 4.50 bln in Apr-Jun 

 

By Ashutosh Pati and Astha Oriel

 

MUMBAI/NEW DELHI – Shree Cement Ltd. expects fuel costs to have "almost" peaked in the June quarter and sees these stabilising from now. This should also support the cement major's profitability in the September and the coming quarters, its management said Friday in the post-earnings conference call with analysts.

 

Shree Cement's bottom line for the June quarter fell sharply due to a rise in costs. It reported a net profit of INR 4.38 billion for the quarter, down over 29% on year. Its power and fuel expenses rose over 29% on year to INR 14.81 billion. The company also used lower grade coal during the quarter as contracted pet coke imports did not reach it. Shree Cement could not procure its contracted gypsum from Oman, which led to buying more expensive gypsum of lower quantity from the domestic market. "They both adversely affected the cost of production of the company...Because of these two factors, two things happened -- the raw material price went up," the management said.

 

The company said it is focusing on profitability, not volumes, like earlier and will do so in the future as well. Shree Cement retained its full year volume guidance of 40 million tonnes, and expects volumes of 19.5 million tonnes-20 million tonnes for the first half of 2026-07 (Apr-Mar). It has also been pushing to raise the share of non-trade sales, as per the management.

 

The company also expects to add seven million tonnes volume on a consolidated basis for the December quarter. Its consolidated volume dipped in the June quarter "majorly because of practically no sales in April and May in UAE (United Arab Emirates) because of war," the management said. They have also asked analysts to consider consolidated figures for the company's financials from now as its plans to double the capacity in UAE. "This quarter, almost 10% of the turnover has been contributed by my overseas subsidiaries and a 100% subsidiary in India and the stand-alone number is about 88-89% only. All these are cement businesses so we would like to request everybody to start looking at the consolidated results and not stand-alone results," the management said.

 

Shree Cement expects its standalone revenues to account for 75-80% of the total revenues in the "not too distant future." The company's standalone revenue for the June quarter accounted for 87% of its consolidated top line. The company is looking to increase its penetration in the eastern region of the country, the management said. Total capacity utilisation for the quarter was 62%, with 66% for north, 60% for east, and 57% for south.

 

The company has retained its FY27 capital expenditure guidance of INR 15 billion. It spent over INR 4.50 billion in the June quarter. Shree Cement declared its June quarter results during market hours Friday. Its shares closed 1.5% lower at INR 26,055 apiece on the National Stock Exchange.  End

 

Edited by Deepshikha Bhardwaj 

 

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