Shree Cement Reports 15% Drop in Q2 Net Profit Due to Elevated Fuel Prices, Revenue Up 23%

Shree Cement Ltd, India's third-largest cement group by capacity, announced its financial results for the September quarter, reporting a 15 per cent decline in consolidated net profit to ₹263.46 crore. The drop in profitability was primarily attributed to elevated fuel prices during the period. In the corresponding quarter of the previous fiscal, the Bangur family-promoted company had posted a net profit of ₹309.82 crore.

Despite the dip in net profit, the company's revenue from operations saw significant growth, surging 23.84 per cent to ₹5,896.51 crore compared to ₹4,761.07 crore in the same period last year. Total consolidated income, including other income, rose 21.63 per cent to ₹6,008.98 crore. For the first half of FY27, SCL reported a total consolidated income of ₹12,453.82 crore.

On the operational front, Shree Cement's consolidated per-tonne EBITDA declined by 8 per cent year-on-year, dropping from ₹1,055 to ₹966, driven mainly by the higher fuel costs. Total expenses for the quarter rose 25.2 per cent to ₹5,641.74 crore. Meanwhile, total domestic sale volumes for cement and clinker grew by 18 per cent year-on-year, moving from 7.91 million tonnes to 9.31 million tonnes. Sales of premium products within India operations also increased, accounting to 28.7 per cent of total trade volume compared to 21.1 per cent a year ago.

The company continued to scale its ready-mix concrete (RMC) business during the quarter. RMC sales volumes more than doubled to 2.73 lakh cubic metres, while revenue surged to ₹129 crore. The segment remained operationally EBITDA-positive, aided by the performance of mature plants and the ramp-up of newly commissioned facilities.

Shree Cement also expanded its focus on sustainable energy, reporting that green electricity accounted for 65.2 per cent of its total power consumption during the quarter. The company currently holds 667 MW of green power generation capacity, including its wholly owned Indian subsidiary, and continues to pursue additional projects to increase renewable energy consumption.

Looking ahead, SCL stated that India’s economic environment remains supportive, underpinned by sustained infrastructure spending, urban development, and stable macroeconomic conditions. While a weak monsoon could pose risks to rural demand, ongoing investments in roads, railways, housing, and data centres are expected to maintain steady cement demand. Shares of Shree Cement traded at ₹22,498.50 apiece in afternoon trade on Friday, up 0.84 per cent from their previous close.

"Shree Cement's latest quarterly results highlight a common operational challenge in heavy industries, where top-line expansion can be constrained by input cost pressures like elevated fuel prices. However, the strong 23 per cent growth in revenue, alongside double-digit growth in domestic sales volumes and expansion in high-margin segments like ready-mix concrete, demonstrates solid underlying market demand. For traditional manufacturing and industrial sectors, balancing volume growth with energy cost management and green power adoption will remain critical to protecting margins amidst macroeconomic fluctuations." — Dr. Shishir Gupta, Founder & CEO, StartupLanes