/** blogpostTitle: Dalmia Bharat FY26: Record EBITDA, Expansion Momentum, and a New Cost Shock blogpostSlug: dalmia-fy26 blogpostCoverImageDescription: Ultra-realistic corporate desk scene with a clean financial dashboard on a laptop showing three simple charts: a rising line for EBITDA and PAT in FY26 versus FY25, a bar chart for cement capacity moving from 49.5 to 55.5 and 61.5 MnTPA across FY27 and FY28, and a stacked bar for cost components per tonne highlighting packing, fuel, and logistics. Background includes blurred industrial cement plant silhouette and a subtle map of India regions without labels. No logos or text. blogpostShortTitle: Dalmia Bharat FY26 record EBITDA, expansion push */

Dalmia Bharat FY26: Record EBITDA, Expansion Momentum, and a New Cost Shock

Dalmia Bharat closed FY26 with its strongest profitability to date. Revenue rose to INR14,804 crore, up 6% year-on-year, while EBITDA increased 28% to INR3,083 crore. Profit after tax jumped 65% to INR1,157 crore. Even in a sector where pricing and input costs can swing quickly, FY26 stood out because the improvement was not driven by just one factor. Volumes edged up, realizations improved, and cost initiatives showed through.

The company ended the year with sales volumes of 30.0 million tonnes, a 2% increase over FY25. Net sales realization per tonne improved to INR4,934, up 4%. But the sharper change came in operating profitability. EBITDA per tonne rose from INR820 in FY25 to INR1,027 in FY26. That mix of slightly higher price, steady volumes, and better unit economics formed the backbone of the year.

What the quarter said about the year

Q4 FY26 reflected how quickly cement profitability can move when dispatches improve and costs are controlled. Volumes in Q4 were 8.8 million tonnes, up 3% year-on-year and 21% sequentially. Trade share returned to 67%, and premium share was reported at 24% of trade volume.

Management also acknowledged that performance could have been stronger on volumes. An unexpected breakdown in East India was cited as a one-off event that reduced year-on-year growth in the peak quarter. The company’s stance, repeated during the call, was that it prefers “profitable volume growth” over chasing share at any cost.

Realizations were steady. For FY26, NSR per tonne improved 4% year-on-year. In Q4 FY26, management noted that while reported realizations looked flat sequentially, the number was impacted by a one-off incentive accrual in the previous quarter. Incentives accrued in Q4 were INR45 crore.

Financial snapshot

Costs: a strong year, then a fresh headwind

A key theme in the deck and the call was cost leadership. Dalmia reported that Q4 FY26 was its lowest quarterly total cost per tonne in the last five years. On a reported basis, total cost per tonne declined from INR3,973 in Q1 FY25 to INR3,790 in Q4 FY26. On a full-year basis, reported cost per tonne reduced from INR3,943 in FY25 to INR3,906 in FY26.

The company also provided an “adjusted” cost series to normalize for the impact of mineral tax in Tamil Nadu and fuel prices, and highlighted that adjusted cost per tonne declined from INR3,966 in FY25 to INR3,866 in FY26.

Breaking down major cost lines:

Raw material cost per tonne of production was INR734 in Q4 FY26, down 6% sequentially, despite an additional mineral tax in Tamil Nadu of INR160 per tonne. Power and fuel cost per tonne of production was INR954 in Q4 FY26, down 6% sequentially, and flat on a full-year basis versus FY25. Logistics cost per tonne in Q4 FY26 was INR1,064, down 6% year-on-year, with the company reporting its highest ever direct dispatch share of 65%.

But the quarter also marked the start of a new cost shock. Management attributed rising pressure to the West Asia conflict, citing higher petcoke prices, packing cost inflation due to PP granules, and logistics impact. The guidance was explicit. From Q4 to Q1, the company expects a cost headwind of INR125 to INR150 per tonne. Packing alone was indicated at INR80 to INR90 per tonne, with the rest split between logistics and power and fuel.

The company’s mitigation levers were described as fuel mix optimization and operational initiatives. Management did not quantify the exact mix shift in the call, stating that decisions are dynamic across plants and regions. Still, the guidance matters because it frames near-term margin risk and sets a clear benchmark for what needs to be recovered through pricing and internal actions.

Expansion: near-term projects are clear, the next milestone is pending

Dalmia Bharat’s cement capacity stands at 49.5 MnTPA. Its near-term expansion is mapped out with three projects.

The company plans to reach 55.5 MnTPA in FY27 through a 3.0 MnTPA expansion at Belgaum, Karnataka, and a 3.0 MnTPA grinding unit at Pune, Maharashtra. It then targets 61.5 MnTPA by Q2 to Q3 FY28 through a 6.0 MnTPA addition at Kadapa, Andhra Pradesh, supported by a 3.0 MnTPA bulk terminal at Chennai.

On clinker, capacity is 27.1 MnTPA currently. Belgaum adds 3.6 MnTPA by FY27, taking clinker capacity to 30.7 MnTPA, and Kadapa adds another 3.6 MnTPA by Q2 to Q3 FY28, taking clinker capacity to 34.3 MnTPA.

Project execution updates were specific. Civil work at Belgaum is complete and electrical and instrumentation work has started, with management expecting commissioning slightly ahead of the earlier schedule. Kadapa and Pune have had major orders placed, and management indicated that minor delays in Q4 FY26 reduced cash outflows during the quarter but the timeline of Q2 to Q3 FY28 for Kadapa remains.

The bigger strategic marker is the company’s stated goal of reaching 72 to 75 million tonnes of capacity around FY28. Management reaffirmed this milestone but did not disclose project-level details in this release, indicating that more announcements are expected.

Capital allocation and balance sheet

Dalmia Bharat highlighted balance sheet strength as a strategic priority. In Q4 FY26, net debt was INR1,428 crore and net debt to EBITDA was 0.46x. The company referenced its capital allocation framework, which uses a 2.0x net debt to EBITDA threshold.

Capex guidance for FY27 was provided in the call. The company expects total capex of INR3,200 to INR3,400 crore. Expansion-linked cash outflow is expected to be around INR2,200 crore, with the remainder described as regular operational capex.

The call also touched on non-core assets. Management said it has already liquidated half of its position in IEX and intends to liquidate the balance when timing is favorable. The deck notes IEX value at INR1,106 crore as of March 31, 2026, included in cash and cash equivalents.

Sustainability and operating footprint

Sustainability data featured prominently. Net emissions were reported at 471 kg CO2 per tonne in Q4 FY26, subject to assurance. Renewable energy share was 47% in Q4 FY26. The company reiterated its aspiration to be net carbon negative by 2040.

The capacity build-out in renewables has been rapid. Total renewable energy capacity reached 449 MW in FY26, up from 267 MW in FY25 and 63 MW in FY22. Management stated that 128 MW will be commissioned soon, taking total capacity to 576 MW.

On operating footprint, the company reported 15 plants, 23 states served, and 2.7+ billion tonnes of limestone reserves for operating mines. By region, cement capacity is spread across South (17.0 MnTPA), East (21.6), North East (8.0), and West (2.9).

Legal matters and contingent liabilities

Dalmia disclosed contingent liabilities of INR1,093 crore in FY26, down from INR1,161 crore in FY25. As a percentage of equity, contingent liabilities were 6.0%.

The company also provided an update on key legal matters. In the Enforcement Directorate land attachment case, the alleged proceeds of crime were reduced from INR793 crore to about INR93 crore by the PMLA Tribunal, and the ED ordered release of attached land parcels against substitution with a bank guarantee of equivalent amount. The company indicated it is in the process of filing an appeal with the High Court against the about INR93 crore proceeds of crime.

Takeaways from FY26

Dalmia Bharat’s FY26 results show what operating leverage can look like when volumes are steady and cost discipline compounds. Record EBITDA and PAT, improved EBITDA per tonne, and low leverage provide room to execute the next phase of expansion.

At the same time, management has signaled that the next two quarters could face a cost reset, driven by fuel, packing, and logistics inflation. The company’s ability to protect margins will likely hinge on how quickly price increases stick in core markets and how much mitigation it can deliver through mix and operational initiatives.

The near-term expansion pathway to 61.5 MnTPA is well defined. The market will now watch for the next set of announcements that support the stated 72 to 75 million tonne milestone and for evidence that profitable volume growth can outpace the industry in FY27, as management has indicated.