Ramco Cements September profit falls 48% despite revenue rise

The Ramco Cements Limited, referred to hereafter as Ramco Cements, reported consolidated profit of Rs 40.43 crore for the quarter ended 30 September 2026, down 48% from Rs 77.34 crore a year earlier, despite revenue from operations rising 10% to Rs 2,462.75 crore. Operating margin declined to 13% from 18%.

Why did Ramco Cements’ September-quarter profit decline?

Ramco Cements’ consolidated profit declined because profit before exceptional items and tax fell to Rs 50.22 crore in the September 2026 quarter from Rs 99.83 crore in the September 2025 quarter. Revenue from operations increased by Rs 224.01 crore year on year, but total expenses rose by Rs 274.13 crore to Rs 2,419.58 crore, exceeding the Rs 224.52 crore increase in total income to Rs 2,469.80 crore.

The reported margin measures show the change in operating outcome. Operating margin, defined by Ramco Cements as profit before exceptional items, interest, depreciation and tax divided by total income, was 13% in the latest quarter versus 18% a year earlier. Net profit margin was 2%, compared with 3% in September 2025. Finance costs declined to Rs 95.58 crore from Rs 111.38 crore, but this did not offset the increase in total expenses.

The September quarter was higher than the immediately preceding June 2026 quarter on reported profit and revenue. Consolidated profit was Rs 40.43 crore against Rs 31.23 crore in June, while revenue from operations rose from Rs 2,273.05 crore to Rs 2,462.75 crore. Operating margin, however, was 13% in September compared with 14% in June.

How did Ramco Cements’ revenue and expenses change?

Ramco Cements’ revenue from operations rose to Rs 2,462.75 crore in the September 2026 quarter from Rs 2,238.74 crore in the September 2025 quarter. Other income increased to Rs 7.05 crore from Rs 6.54 crore, taking total income to Rs 2,469.80 crore from Rs 2,245.28 crore. The company reports a single operating segment, cement and cement-related products, rather than separate product-line results.

Total expenses increased to Rs 2,419.58 crore from Rs 2,145.45 crore, leaving Rs 50.22 crore of profit before exceptional items and tax, compared with Rs 99.83 crore a year earlier. The difference between the increases in expenses and total income accounts for the lower pre-exceptional profit, even though quarterly revenue grew.

Several disclosed cost lines rose from the comparable quarter. Cost of materials consumed was Rs 390.25 crore versus Rs 364.15 crore, transportation and handling was Rs 526.47 crore versus Rs 462.67 crore, and power and fuel was Rs 684.18 crore versus Rs 609.74 crore. Depreciation and amortisation increased to Rs 190.24 crore from Rs 183.34 crore, while other expenditure was Rs 307.80 crore against Rs 264.48 crore.

What was the effect of Ramco Cements’ land sale?

Ramco Cements recorded an exceptional gain of Rs 4.80 crore from the sale of surplus land in the September 2026 quarter. The gain increased profit before tax to Rs 55.02 crore from Rs 50.22 crore before exceptional items. There was no exceptional item in the corresponding September 2025 quarter, when profit before tax was Rs 99.83 crore.

After tax and the share of associates’ result, consolidated profit attributable to equity shareholders was Rs 40.43 crore, compared with Rs 77.34 crore a year earlier. Basic and diluted earnings per share, which were not annualised, were Rs 1.71 for the quarter, down from Rs 3.27. In the preceding June 2026 quarter, Ramco Cements had booked a larger Rs 12.62 crore gain on surplus land sales.

For the half year ended 30 September 2026, surplus-land sales contributed Rs 17.42 crore of exceptional income, compared with no such item in the first half of the prior year. Half-year consolidated profit was Rs 71.66 crore, down from Rs 162.37 crore in the comparable 2025 period, while revenue from operations rose to Rs 4,735.80 crore from Rs 4,312.76 crore. The exceptional income did not reverse the year-on-year decline in half-year profit.

What do Ramco Cements’ cash flow and borrowings show?

Ramco Cements generated Rs 273.61 crore of net cash from operating activities in the half year ended 30 September 2026, compared with Rs 645.74 crore in the corresponding prior-year half. Cash generated from operations was affected by a Rs 250.40 crore movement in trade payables and other liabilities, whereas this line added Rs 27.74 crore in the prior-year period.

Purchases of property, plant and equipment, intangible assets and investment properties totalled Rs 372.57 crore in the six months, down from Rs 600.61 crore a year earlier. Net cash used in investing activities was Rs 332.50 crore, compared with Rs 545.13 crore. Net cash used in financing activities was Rs 105.28 crore after Rs 198.98 crore of long-term borrowing repayments and Rs 134.33 crore of interest payments.

Cash and cash equivalents, net of cash credit, were Rs 24.15 crore at 30 September 2026, compared with Rs 69.82 crore at 30 September 2025. Consolidated current borrowings were Rs 1,584.92 crore at 30 September 2026, up from Rs 1,048.16 crore at 31 March 2026, while non-current borrowings declined to Rs 2,378.22 crore from Rs 2,803.89 crore.

Which ratios and unresolved matters should readers watch?

Ramco Cements reported a debt-equity ratio of 0.49 times at 30 September 2026, down from 0.62 times a year earlier, while total debts to total assets declined to 24% from 28%. The current ratio was 1.08 times compared with 1.11 times in September 2025. Interest service coverage was 3.16 times, versus 3.25 times in the previous year’s quarter.

A disputed Tamil Nadu mineral-bearing land-tax matter could affect future accounting. Ramco Cements said it remitted Rs 8.61 crore under protest for the period from 22 August 2026 to 30 September 2026 without recognising the amount as an expense, because it believes the levy is no longer payable. The Tamil Nadu government’s Mineral Management System portal had not been updated, and the company said its representation with other cement producers remains pending.

Ramco Cements also disclosed a Rs 258.63 crore Competition Commission of India penalty concerning alleged cartelisation. It re-deposited Rs 25.86 crore, equal to 10% of the penalty, after the Supreme Court admitted its appeal on 5 October 2018 and continued the interim order. Ramco Cements said it has made no provision, based on legal opinion that it has a good case.

Conclusion

Ramco Cements delivered higher September-quarter revenue but lower reported profitability, with consolidated profit falling to Rs 40.43 crore as expenses increased faster than income and operating margin fell by five percentage points year on year. The Rs 4.80 crore surplus-land-sale gain added to reported profit, while first-half operating cash flow fell to Rs 273.61 crore from Rs 645.74 crore.

The next reported periods will show whether Ramco Cements can improve on the 13% operating margin recorded in September 2026 and how working-capital movements develop after the Rs 250.40 crore outflow in trade payables and other liabilities during the first half. The pending Tamil Nadu levy representation will also determine whether the Rs 8.61 crore paid under protest is recognised as an expense.