India Cements shares fell around 6% to ₹383 apiece on Monday, July 20, despite the company's return to profitability in Q1 FY27. The stock was trading 4.11% down by 9:36 am, underperforming the benchmark Nifty 50 index which was 0.65% down during the same period. This market reaction contrasts sharply with the positive sentiment that followed the company's earlier profit announcement, highlighting investor concerns about the cement maker's operational performance despite the financial turnaround. Motilal Oswal has now issued a sell rating on the stock with a target price of ₹350, citing expected transition costs that may limit further rerating potential.
**India Cements delivered a remarkable financial turnaround in Q1 FY27, posting a consolidated net profit of ₹26.9 crore against a net loss of ₹133 crore in the corresponding quarter of the previous year. According to the latest financial results, this represents a significant improvement in the company's operational performance during the quarter ended June 30, 2026. The company has now returned to profitability as a subsidiary of UltraTech Cement Ltd, following UltraTech's phased acquisition of the company. Adjusted for net impact of profit on sale of assets and provision for disputed liabilities for earlier years, the PAT stood at ₹455 million versus a loss of ₹75 million in Q1 FY26, demonstrating the company's underlying operational improvements.
The company's standalone net profit reached ₹26.62 crore for Q1 FY27, driven by robust operational performance with domestic cement volume increasing 18.5% year-on-year to 2.58 MTPA. EBITDA surged 84.5% to ₹155 crore while operating EBITDA per tonne improved by ₹221 to ₹603 compared to the same period last year. The company achieved an operating margin of 15.2%, supported by a 1.5% quarter-on-quarter increase in sales realisation to ₹3,847 per tonne, compared to ₹3,791 per tonne in Q4 FY26 and ₹3,770 per tonne in Q1 FY26. EBITDA per tonne grew approximately 61% year-on-year to ₹604 versus estimated ₹424, with operating margin surging 7.3 percentage points to around 15% against estimated 11%, reflecting better cost management and operational efficiency.
The company's revenue from operations declined 0.6% year-on-year to ₹1,019 crore from ₹1,025 crore in Q1 FY26, as reported by Business Standard. However, compared to the preceding quarter ended March 31, 2026, revenue declined by 17.03% from ₹1,228.65 crore. The company's total income declined 1.1% year-on-year to ₹1,022.87 crore. The company's consolidated net profit also declined 54.87% sequentially from ₹59.50 crore in Q4 FY26. Despite the revenue stability, the company demonstrated strong operational efficiency improvements during the quarter, with EBITDA margin expanding to 15.2% from 8.2% year-on-year, reflecting better operational efficiency despite nearly flat revenue.
The company's profit before exceptional items and tax stood at ₹61.08 crore in Q1 FY27, marking a substantial improvement from the loss of ₹8.34 crore recorded in the corresponding quarter of the previous year. According to the latest results, the company reported exceptional items of ₹25.3 crore, which included a profit of ₹29.98 crore on the sale of assets offset by a provision of ₹55.26 crore for disputed liabilities from earlier years. The company's basic earnings per share for the quarter was ₹0.87, representing a significant improvement from a basic loss per share of ₹4.29 in the year-ago quarter. Profit before tax stood at ₹35.57 crore with basic and diluted earnings per share of ₹0.86. Notably, one-time losses narrowed substantially to ₹25.3 crore from ₹124 crore a year ago, providing a major boost to the bottom line.
