India's leading cement companies delivered healthy sales volume growth in Q1FY27, with the industry reporting average volume growth of around 7-8% year-on-year. According to analysts, top players including UltraTech Cement, Shree Cement, JK Cement and Dalmia Bharat outperformed the industry average. However, Ambuja Cements was the only major underperformer, with volumes declining primarily due to a calibrated decrease in exposure to the non-trade segment and exit from low-profitability regions, reducing its sales mix in the South and East.
Despite strong volume performance, profitability remained under pressure as higher fuel, packaging and other input costs offset gains from price increases. As reported by Capital Market Strategy, UltraTech Cement was the standout performer with Ebitda per tonne rising 1.4% Y-o-Y to ₹1,214, supported by better realisations, scale, premium products and cost efficiencies. In contrast, Shree Cement's Ebitda per tonne declined by about 25%, while Dalmia Bharat's Ebitda per tonne fell by 16%. Ambuja's Ebitda per tonne dropped by about 13%, and JK Cement's Ebitda per tonne dipped by 20% Y-o-Y.
The biggest cost pressure came from fuel costs, with coal and petcoke prices rising 30-35% from their average Q3FY26 levels. According to Equirus Securities, power and fuel costs increased by around ₹160 per tonne or 14% sequentially, while higher packaging material costs pushed other operating expenses up by around ₹70 per tonne. Crisil Intelligence estimated that industry margins contracted by 180-220 basis points during the quarter. Ambit Institutional Equities estimated the fuel-cost increase attributable to the West Asia conflict at roughly ₹70-80 per tonne in Q1FY27, with packaging adding another ₹80-100 per tonne.
According to Equirus Securities, realisations improved by around ₹200 per tonne or 4% quarter-on-quarter, driven by price increases implemented to offset higher raw material and fuel costs. Prices rose by around ₹10-15 per bag in April before correcting gradually in May and June, resulting in an effective price increase of around ₹7-10 per bag across regions in Q1. The weighted average profitability of top players improved sequentially by ₹25 per tonne, though excluding Ambuja, average profitability was down by ₹40 per tonne Q-o-Q. Ambit Institutional Equities expects costs to peak in Q2 with another ₹70-100 per tonne increase, while better volumes in the second half could support profitability.
