Ambuja Cements: Building a Stronger Foundation in Q2 FY26

Ambuja Cements Limited, a key player in India's cement industry, has reported a robust performance for the second quarter and first half of the financial year 2026. The company, operating under the Adani Cement umbrella, continues to demonstrate strong operational efficiency and strategic growth, reinforcing its position in the market. The Q2 FY26 results highlight significant advancements in volume, profitability, and strategic initiatives, setting a positive trajectory for the coming years.

For Q2 FY26, Ambuja Cements achieved a cement volume of 16.6 million tons, marking a substantial 20% year-on-year growth. This performance significantly outpaced the industry average. The company's revenue from operations stood at INR 9,174 crore, a 21% increase from the previous year. EBITDA reached INR 1,761 crore, up 58% year-on-year, with an EBITDA margin of 19.2%, an uptick of 4.5 percentage points. Profit After Tax (PAT) saw an extraordinary jump of 364% year-on-year, reaching INR 2,302 crore. This impressive PAT figure includes an income tax provision reversal of INR 1,697 crore for Q2 FY26 and H1 FY26, reflecting favorable High Court decisions.

The first half of FY26 also showcased strong consolidated performance, with cement volume at 35.0 million tons (up 20% YoY), revenue from operations at INR 19,464 crore (up 22% YoY), and EBITDA at INR 3,722 crore (up 56% YoY). The H1 FY26 PAT was INR 3,319 crore, a 159% increase year-on-year. The company's net worth increased to INR 69,493 crore, and it continues to maintain a debt-free status with the highest credit ratings of Crisil AAA (stable) / Crisil A1+.

Strategic Expansion and Operational Excellence

Ambuja Cements is aggressively pursuing its growth strategy, with a revised FY28 target capacity of 155 MTPA, an increase of 15 MTPA from the earlier 140 MTPA. This incremental capacity will be achieved through debottlenecking initiatives at a significantly lower capital expenditure of $48 per metric ton. The company is also installing 13 blenders across its plants over the next 12 months to optimize its product mix and increase the share of premium cement, thereby improving realizations. Plant logistics infrastructure debottlenecking is expected to improve the utilization of the current 107 MTPA capacity by 3% over 24 months.

In a move towards digital leadership, Ambuja Cements launched CINOC (Cement Intelligent Network Operations Centre) to infuse an AI layer deep into its enterprise fabric, aiming for a paradigm shift in operations, efficiency, and stakeholder engagement. The company has also ordered 7 vessels with a total capacity of 65,800 DWT to increase its share of sea logistics to 5%. A strategic MoU with Container Corporation of India Limited (CONCOR) was signed on October 24, 2025, for rail-based transportation of bulk cement, which will optimize logistics costs, support net-zero emission commitments, and promote a modal shift from road to rail.

Cost Management and Sustainability Focus

The company's cost leadership journey has resulted in a 5% year-on-year reduction in the cost of sales. Management aims to achieve a total cost of approximately INR 4,000 PMT by March '26 exit, further reducing it to INR 3,650 PMT by the end of FY '28. This will be enabled by improved operating leverage, brand strengths, and synergies within the Adani ecosystem. The green power share increased to 33% in Q2 FY26 and is targeted to reach 60% by FY28, with a goal to reduce power cost to INR 4.5 per kWh.

Ambuja Cements is also committed to sustainability, with SBTi validated net-zero targets for 2030 and 2050. The company reported being water positive 29.6x in Q2 FY26 and has planted 1.5 million trees till FY25. These initiatives underscore its commitment to environmental responsibility and operational efficiency.

Market Outlook and Future Prospects

The cement sector is expected to benefit from favorable macroeconomic factors, including GST 2.0 reforms and increased investments in public and private sectors. Cement demand is projected to expand by 7%-8% during FY26, driven by rural and urban infrastructure and housing projects. The company's market share has increased by 1 percentage point to 16.6% and is targeted to reach 20%-22% by FY28. Management remains optimistic about delivering double-digit revenue growth and four-digit PMT EBITDA, leveraging its strategic initiatives and strong market position.

Ambuja Cements' Q2 FY26 performance reflects a company in strong growth mode, driven by strategic expansions, rigorous cost management, and a clear focus on sustainability. The integration within the Adani Group ecosystem provides significant synergies, further enhancing its competitive edge. With a robust pipeline of projects and a commitment to operational excellence, Ambuja Cements is well-positioned for sustained growth and value creation for its stakeholders.