Revenue
Margin
Demand
Guidance
Tone
Metrics raised 1
- Belgaum expansion commercial production timeline accelerated to within the next 6 months (ahead of schedule)
Event Participants
Executives
4 Dharmender Tuteja, Prassan Goyal, Puneet Dalmia, Yatin Malhotra
Analysts
15 Amit Murarka, Gaurav Nagori, Indrajit Agarwal, Jashandeep Singh Chadha, Kunal Shah, Navin Sahadeo, Pinakin, Prateek Kumar, Pulkit Patni, Raashi, Rajesh Ravi, Sarthak Tita, Satyadeep Jain, Shravan Shah, Siddharth Mehrotra
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue from operations | ₹3,890 crores | Up 7% YoY, driven by higher sales volumes; realizations improved 6% QoQ on price hikes, premiumization and brand strength |
| Cement volume growth | +9% YoY | Third straight quarter of healthy growth ex-Rajgangpur one-off; estimated 200-250 bps above industry growth of 7-8% |
| Premium product share | 25% of portfolio | Marked improvement in sales quality; Weather365 premium-plus launch received encouraging response |
| Realized price increases | ₹10-15/ton South; ₹15-20/ton East | Enabled pass-through of a significant portion of input cost inflation |
| Raw material cost per ton | ₹823 | Up 12% QoQ on higher limestone raising cost and other cost headwinds |
| Power & fuel cost per ton | ₹1,045 | Up 10% YoY on sharp fuel price escalation; blended fuel cost at ₹1.47/Kcal vs ₹1.36 QoQ; 48% of power from renewables |
| EBITDA per ton | ₹1,055 | Up 3% QoQ; supported by price hikes and >₹150/ton savings from procurement, inventory and fuel mix initiatives |
| EBITDA | ₹805 crores | Down 11% QoQ; improved realizations offset by lower volumes and higher costs from external headwinds |
| Other income | ₹139 crores | Mark-to-market gains on treasury investments as market yields corrected post policy announcement |
| Depreciation | ₹361 crores | Up 12% YoY, mainly due to capitalization of Umrangso clinker unit in January 2026 |
| Finance cost | ₹147 crores | Up 36% YoY on higher gross debt from acquisition funding; average cost of debt range-bound at ~7% |
| Exceptional items | ₹182 crores | Stamp duty, transaction fees and related overheads for Jaypee acquisition; provisional conservative estimate |
| Gross debt | ₹9,108 crores | Increased primarily due to Jaypee acquisition funding |
| Net debt / leverage | ₹4,431 crores / 1.47x | Leverage comfortably below 2x net debt-to-EBITDA, demonstrating balance sheet strength |
| Incentive outstanding | ₹822 crores | Accrued ₹45 crores and collected ₹60 crores in Q1; accrual expected to remain at ₹45-50 crores per quarter |
Geographic & Segment Commentary
- East India: State elections temporarily moderated construction activity, yet Dalmia delivered 9% YoY volume growth; price hikes of ₹15-20/ton implemented. Bengal saw price suppression in June-July while other markets held steady. Management expects ~10-11 MT of industry capacity additions per year in FY27-28 but believes demand will absorb supply.
- South India: Price increases of ₹10-15/ton during the quarter, with additional uptick seen in early July. Belgaum expansion is progressing ahead of schedule, with commercial production expected in the next 6 months.
- Central India (Jaypee): Acquisition completed May 29, 2026 at ₹2,850 crores EV, adding 5.2 MT cement and 3.3 MT clinker capacity. Chunar grinding unit commenced operations and Rewa clinker trial production started within 50 days; assets expected to reach EBITDA neutrality in ~2 quarters and Dalmia-average EBITDA/ton in 7-8 quarters.
- Northeast: Umrangso clinker unit capitalized in January 2026; regional surplus clinker to be balanced by an additional grinding unit, which is on the agenda though not yet announced.
- Premium portfolio: Premium products reached 25% of sales; Weather365 premium-plus launch strengthens the premiumization journey and improves revenue quality over time.
Company-Specific & Strategic Commentary
- Jaypee Acquisition & Integration: ₹2,850 crores EV funded through a prudent mix of debt and internal accruals; integration executed with speed (Chunar and Rewa running within 50 days); includes installation of an 18 MW WHRS facility at Rewa; catch-up and efficiency capex is within existing FY27 guidance.
- Capacity Expansion Roadmap: Cement capacity to reach ~67 MT by Q3 FY28 with Jaypee, Belgaum, Kadapa and Pune; directional target of ~110 MT by FY31 remains flexible, calibrated to industry and macro conditions with disciplined capital allocation.
- Cost Leadership: Procurement, inventory planning and fuel mix optimization generated >₹150/ton savings in Q1; 48% of power sourced from renewable energy, with share rising as capacities are added; annual cost efficiency program of ₹50-100/ton confirmed on track.
- Premiumization: Premium share at 25%; Weather365 launched during the quarter; strengthening brand position supported realization improvement of 6% QoQ.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| FY27 industry cement demand growth | ~7% | Supported by RBI GDP projection of 6.6% for FY27, record GST collections (₹6.3 lakh crores in Q1) and public capex at 21% of budget in first 2 months |
| Volume growth | In line with industry (7-8%) | Organic growth guided at industry level; Jaypee and new capacities add on top; Q1 outperformance estimated at 200-250 bps |
| FY27 capex | ₹3,200-3,400 crores | Includes Jaypee catch-up/efficiency capex; excludes ₹2,850 crores acquisition EV; ~₹2,200 crores towards projects, balance maintenance and ROI |
| Q2 FY27 input costs | +₹70-80/ton QoQ (evolving) | West Asia resurgence could push higher; pet coke moderated to $130-135/ton but remains above pre-war $110-115/ton |
| Jaypee profitability | EBITDA neutral in ~2 quarters; Dalmia-average EBITDA/ton in 7-8 quarters | Legacy issues and ramp-up costs in the initial period; management confident given pre-seeded brand and network |
| Depreciation | +₹100 crores in FY27; +₹100-150 crores in FY28 | On commissioning Jaypee and Belgaum (FY27), Kadapa and Pune (FY28) |
| Incentive accrual | ₹45-50 crores per quarter | Expected to continue for the next couple of years |
| Capacity | ~67 MT by Q3 FY28 | Belgaum in next 6 months; Kadapa and Pune under construction; ~70 MT soon after with Northeast grinding |
| Cost efficiency | ₹50-100/ton annual savings | Continuous program; management confirmed delivery on track, not treated as formal guidance |
Risks & Constraints
| Risk | Context |
|---|---|
| West Asia conflict / fuel cost escalation | Pet coke surged to ~$160/ton in Q1 before moderating to $130-135/ton, still well above pre-war $110-115/ton; renewed hostilities could push Q2 input costs above the ₹70-80/ton estimate; management mitigating via sourcing diversification, inventory planning and fuel mix optimization |
| Jaypee integration and ramp-up execution | Plant was shut for a long period and is relatively older, requiring catch-up capex to bring down the cost curve; initial EBITDA drag expected for ~2 quarters; management cites prior tolling experience and pre-seeded brand presence as mitigants |
| East India pricing pressure | Bengal witnessed price suppression in June-July; East prices remain below other regions; management relies on premiumization and brand strength, but market pricing dynamics remain outside company control |
| Monsoon / El Nino uncertainty | Potential El Nino effect on monsoon progress warrants close monitoring; could create short-term demand fluctuations |
| Industry capacity additions | ~10-11 MT per year of industry capacity being added in East in FY27-28; management expects 7-8% demand growth to absorb supply |
| Input cost volatility (packing bags, diesel) | Packing bag prices rose to ~₹14/bag vs ~₹9.5 pre-war (moderating in Q2); diesel price increases from late May add to Q2 cost pressure |
Q&A Highlights
Jaypee Acquisition – Limestone, Land & Valuation
- Question: For the 100 MT limestone reserves, is the entire land required to access them in control? What is the approximate additional cost? (Navin Sahadeo)
- Answer: Existing land is sufficient for the initial few years, with adjacent reserves already available; land procurement is a gradual, ongoing process at any plant, not a one-time cost hit; no exact number can be indicated now (Yatin Malhotra)
- Question: How does Jaypee asset quality compare with Murli, Kalyanpur and Northeast acquisitions? (Prateek Kumar)
- Answer: Strategically attractive — accelerates Central India entry, offers brownfield/debottlenecking optionality, and has existing infrastructure (railway siding, colony, surplus land); the plant is older and was shut for a long time, requiring efficiency capex; acquired at close to replacement cost; Jaypee-built Bokaro (acquired 2015) delivered very well (Puneet Dalmia)
Jaypee Ramp-Up and Profitability Path
- Question: What utilization for Jaypee in Q3/Q4 FY27 or FY28? When will it match Dalmia's organic EBITDA per ton? (Amit Murarka; Raashi; Satyadeep Jain)
- Answer: Chunar grinding unit was running within 20 days and Rewa clinker trial production started; too early for realistic volume estimates, but hopeful of decent utilization in a few quarters; EBITDA-neutral expected in ~2 quarters and Dalmia-average EBITDA/ton in 7-8 quarters; network and brand were continuously seeded in the region over the past couple of years (Yatin Malhotra)
Q2 Cost Trajectory
- Question: Does the ₹150/ton cost saving reverse in Q2? What is the quantum of Q2 cost increase? (Amit Murarka; Sarthak Tita)
- Answer: ₹150/ton savings are structural (procurement, fuel mix, inventory) and will not reverse; 10 days ago, Q2 input cost increase was estimated at ₹70-80/ton, but renewed West Asia hostilities make this an evolving number; diesel increases (late May) and moderating packing bag costs are additional moving parts (Yatin Malhotra)
Volume Growth vs Industry
- Question: How does 9% growth fare against operating market growth? What is the FY27-FY28 volume outlook? (Kunal Shah; Siddharth Mehrotra)
- Answer: Q1 growth was likely 200-250 bps above industry; organic volume growth guided in line with industry (7-8%), with Jaypee and new capacities on top; Belgaum, Kadapa and Jaypee markets are well known, so ramp-up should not be an issue (Yatin Malhotra)
Capacity Roadmap Flexibility
- Question: Is 110 MT by FY31 still achievable given balance sheet impact of ~40% capacity addition? (Shravan Shah)
- Answer: 110 MT is a directional number; speed will be calibrated based on industry and macro conditions; 67 MT by Q3 FY28 is on a clear path with ~70 MT soon after; a couple of quarters here or there doesn't matter — the company will remain disciplined on capital allocation and will not "burst the bank" (Puneet Dalmia; Yatin Malhotra)
Capex Guidance Scope
- Question: Does the ₹3,200-3,400 crores FY27 capex include Jaypee? (Siddharth Mehrotra)
- Answer: Jaypee start-up and efficiency capex is within this range; only the ₹2,850 crores acquisition EV is on top; the earlier ₹550 crores Jaypee refurbishment estimate remains a work in progress (Yatin Malhotra)
East India Pricing
- Question: What will narrow the price gap between East and other regions? (Pinakin; Indrajit Agarwal)
- Answer: No clear answer on price stickiness — it is a dynamic industry factor; Dalmia's levers are premiumization and brand strength; most markets held steady at June exit, Bengal saw some price suppression, and South saw an uptick in early July (Yatin Malhotra)
Exceptional Item Accounting
- Question: Why is the ₹182 crores exceptional expense (stamp duty/transaction costs) not capitalized? (Pulkit Patni)
- Answer: The acquisition qualifies as a business combination; assets are fair-valued and stamp duty does not add additional asset value, so transition costs are expensed as per accounting standards; for tax purposes it is treated as a capital asset with depreciation claimed; the amount is provisional and conservative, with final clarity expected in ~2 months (Dharmender Tuteja)
Other Income Line
- Question: Is the mark-to-market gain in other income related to IEX? (Rajesh Ravi)
- Answer: IEX gains go to other comprehensive income; other income reflects treasury investments in mutual funds and bonds; yields corrected in Q1 after the policy announcement and RBI measures to attract FPIs and ECBs; average treasury yields should be ~6.5-7% (Dharmender Tuteja)
North India Foray
- Question: Any update on North region entry? Is it delayed due to Jaypee priority? Are volumes being moved from Central to North? (Gaurav Nagori)
- Answer: Moving material from Central to North is not on the table; North remains on the Pan-India roadmap but timing and announcements will be communicated as the company progresses (Yatin Malhotra)
Key Takeaway
Dalmia Bharat delivered resilient Q1 FY27 results despite state elections in key markets and elevated input costs: volumes grew 9% YoY (an estimated 200-250 bps above industry), EBITDA per ton improved 3% QoQ to ₹1,055, supported by ₹10-20/ton price hikes and over ₹150/ton in procurement-led savings. The Jaypee Cement acquisition (₹2,850 crores EV; 5.2 MT cement, 3.3 MT clinker in Central India) closed May 29, 2026, with Chunar grinding and Rewa clinker running within 50 days; management guides EBITDA-neutrality in ~2 quarters and Dalmia-average EBITDA/ton in 7-8 quarters. FY27 capex guidance holds at ₹3,200-3,400 crores, with capacity reaching ~67 MT by Q3 FY28 and a flexible directional path toward ~110 MT by FY31. Key watch points include West Asia-driven fuel cost resurgence (Q2 input costs +₹70-80/ton, evolving), East India pricing pressure in Bengal, and disciplined balance sheet management with net debt/EBITDA at 1.47x.