Dalmia Bharat reports robust Q2 FY26 earnings with 60% EBITDA growth
Dalmia Bharat reported strong Q2 FY26 results with a 60% EBITDA growth to ₹696 crores, supported by cost control and higher realizations. Capacity expansions are on track, and an interim dividend of ₹4 per share was declared.
The announcement covers robust quarterly earnings, major capacity expansion plans, the impact of significant government policy changes (GST, coal cess), and a dividend declaration. These factors collectively have a high impact on the company's financial prospects and operational strategy.
The company demonstrated strong financial performance with significant year-on-year growth in revenue and EBITDA, improved margins, and effective cost control. Positive regulatory changes like GST reduction and strategic capacity expansions also contribute to a favorable outlook.
Dalmia Bharat Limited announced its Q2 FY26 earnings and business updates following an earnings conference call held on October 17, 2025:
* Financial Performance (Q2 FY26 ended September 30, 2025): * Revenue increased by 11% year-on-year to ₹3,417 crores. * EBITDA grew significantly by 60% year-on-year to ₹696 crores, achieving ₹1,013 per ton, marking the second consecutive quarter with four-digit cement EBITDA per ton. * EBITDA margin improved to 20.4% from 14.1% in Q2 FY25. * Volume growth stood at 2.9% year-on-year, with realization increasing by 7.6% year-on-year. * Trade share was 62%, and premium product share was 22%. * Raw material cost per ton marginally increased by 1% year-on-year to ₹799 per ton. * Power and fuel cost per ton also marginally increased by 1% year-on-year to ₹1,017 per ton, with renewable energy (RE) share at 48%. The company commissioned 93 Megawatt of RE capacity this quarter and aims to scale operational RE capacity to 576 Megawatt by the end of FY26. * Logistic costs declined by 3.8% year-on-year to ₹1,060 per ton.
* Regulatory & Industry Updates: * The reduction in GST on cement from 28% to 18% is a significant positive, with benefits fully passed on to consumers, expected to boost consumption and housing demand. * Due to lower GST, total incentive accrual for FY26 is now expected around ₹240 crores, down from the earlier guidance of ₹300 crores. * The removal of coal compensation cess will provide a benefit of ₹20 crores in H2 FY26 and ₹50-₹55 crores for the full FY27. * Management expects H2 FY26 demand to improve after a softer H1 (low single-digit growth) caused by erratic rains and the GST regime change. Cement prices remained stable in Q2 despite heavy rainfall.
* Capacity Expansion & Capex: * Belgaum and Kadapa expansion projects, targeting 12 million tons per annum of cement capacity, are progressing as planned. * Trial run production of the new 3.6 million ton per annum clinker line in Umrangso, Assam, commenced in September, with commercial production anticipated in Q3 FY26. This will support an additional 2-2.5 million tons of split grinding capacity. * Capex incurred in H1 FY26 was ₹1,189 crores. The estimated Capex for FY26 is ₹3,000 crores (revised lower due to favorable credit terms and postponements), and for FY27, it is estimated at approximately ₹4,000 crores. * The company maintains its target of 75 million tons capacity by FY28, with further clarity on remaining capacity to be provided by March 2026, pending the outcome of the JP transaction.
* Debt & Dividend: * Gross debt stood at ₹6,621 crores, and net debt at ₹1,602 crores at the end of the quarter. The cost of borrowing reduced to 6.9%. Net debt-to-EBITDA was 0.56x. * The Board declared an interim dividend of ₹4 per share.
* Other Updates: * A variable pay structure linked to company performance, individual performance, and safety has been introduced for senior and middle management from FY26. * Anirudh Tara has been appointed as Chief Strategy Officer. * The company continues to liquidate its non-core investment in IEX shares, having already sold more than half its position.
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