Dalmia Bharat Refractories reported a standalone net loss of ₹63.85 crore for the quarter ended June 2026, compared to a net loss of ₹38.39 crore in the corresponding quarter of the previous year. According to reports from Business Standard, the company's financial performance showed significant year-over-year changes in key metrics during the first quarter of fiscal 2026. The latest results reflect the impact of exceptional costs from the company's cement business operations, with revenue from operations increasing 7% year-over-year to ₹3,890 crore but declining 8% sequentially from Q4 FY26's ₹4,245 crore. The company's shares fell 2.37% to ₹1,810.8 following the results, reflecting investor concerns about near-term margin pressure despite the successful completion of its 5.2 million ton per annum Central India acquisition.
The company achieved robust volume growth of 9% year-on-year to 7.6 million tonnes in Q1 FY2026, outpacing estimated industry growth of 7-8%, as reported by Investing.com. This strong operational performance demonstrates the company's ability to maintain market share despite state elections disrupting construction activity in core markets. The company's operating profit margin (OPM) stood at -38.11% in the June 2026 quarter, compared to -40.97% in the corresponding quarter of the previous year. EBITDA per ton improved 3% sequentially to ₹1,055, demonstrating the company's ability to maintain unit economics through pricing discipline and premiumization, even as absolute profitability declined due to lower volumes. The company achieved premium products reaching an all-time high of 25% of trade volume, up from 22% a year earlier, with trade share remaining steady at 66%.
Dalmia Bharat's consolidated net profit declined 51.4% to ₹192 crore in Q1 FY27, primarily due to exceptional costs of ₹182 crore related to the acquisition of cement assets from debt-ridden Jaiprakash Associates Ltd (JAL). As per the company's regulatory filing, these exceptional costs included ₹177 crore in acquisition-related costs for the remaining cement assets of JAL. The company had posted a net profit of ₹395 crore in the corresponding quarter of the previous year, highlighting the significant impact of these one-time costs on quarterly performance. Excluding these exceptional items, profit before tax and exceptional items stood at ₹436 crore, down 13% from Q1 FY26's ₹502 crore. The acquisition was financed through debt, increasing the company's net debt to ₹4,431 crore from ₹1,428 crore in Q4 FY26, though the leverage ratio of 1.47x net debt to EBITDA remains comfortably below the company's threshold of 2.0x.
The quarter's defining strategic development was the completion of Dalmia Bharat's acquisition of 5.2 million tons per annum of cement capacity in Central India, marking a significant step in the company's journey to become a pan-India player. The acquired assets include the Chunar grinding unit (2.5 MnTPA), Rewa integrated unit (1.1 MnTPA cement and 3.3 MnTPA clinker), and Sadwa blending unit (0.6 MnTPA). The Chunar facility commenced operations immediately, with the company successfully dispatching its first cement consignment on June 20, 2026—just 22 days after acquisition completion. The acquisition offers multiple benefits including entry into high-potential markets with strong pricing, proximity to Dalmia's captive limestone mines in Satna, and faster market entry compared to greenfield projects. The acquired JP assets are expected to contribute meaningfully from Q3 FY27 onward, though management noted it may take 7-8 quarters for these facilities to reach Dalmia's normalized EBITDA per ton levels.
The company faced significant cost headwinds during Q1 FY27, with raw material costs surging 12% quarter-over-quarter to ₹823 per ton and power and fuel costs rising 10% sequentially to ₹1,045 per ton. Management acknowledged that cost pressures are expected to persist in the near term, with Q2 FY27 costs projected to increase by ₹70-80 per ton versus Q1, excluding negative operating leverage effects. Petcoke prices remain above pre-conflict levels, diesel cost increases will fully impact Q2, and packing bag prices continue at elevated levels. However, the company expects organic volume growth to track industry growth of 7-8%, with additional contributions from new capacity and the Central India acquisition. The company reaffirmed its disciplined capital allocation approach, with FY27 capex estimated at ₹3,200-3,400 crore excluding the acquisition cost, while maintaining its commitment to balance sheet health with the leverage ratio remaining below the 2.0x threshold.
