According to reports from Business Standard, Shree Cement Ltd reported mixed results for Q3 FY26, with revenue increasing 4% year-on-year and net profit rising 21% to ₹279 crore compared to ₹229 crore in Q3 FY25. However, operating profit declined 9% YoY despite the revenue growth, indicating margin pressures. The company's volume grew marginally by 2% YoY to 8.95 million tonnes per annum, while operating profit margin compressed to 19.5% from 22.3% in the previous year.
As reported by Business Standard, the company faced pricing challenges with blended realisation per tonne declining 4% YoY and 10% quarter-on-quarter to ₹4,937. However, cost per tonne decreased 7% QoQ to ₹3,975, helping to partially offset the pricing pressure. The operating profit per tonne stood at ₹962, down 11% YoY, reflecting the impact of lower realisations on profitability metrics.
According to the report, Shree Cement continues its expansion strategy with current installed capacity of 65.8 million tonnes per annum (MTPA) and ongoing projects planned to reach 68.8 MTPA by end of FY26 and 72 MTPA by FY27. The company has planned capex of ₹2,000 crore for FY26, to be funded through internal accruals, compared to ₹3,470 crore in FY25. During 9MFY26, the company incurred ₹1,500 crore in capex, indicating continued investment in capacity expansion.
As reported by Business Standard, the company is focusing on margin expansion through higher premium portfolio share, green energy adoption, and supply chain optimization. Premium products accounted for 22% of total trade cement sales in Q3FY26, up from 15% in Q3FY25. The company maintains 60% share of green electricity in total consumption, among the highest in the cement industry, with green capacity at 634.5 MW at end of 9MFY26, up 32% from 480 MW in FY24-FY25. Management indicated demand has picked up since December with improved cement prices.
According to the report, the company faces challenges with capacity utilisation at 55% and has lost market share to peers, which analysts consider a concern. However, the company's strong balance sheet and cost leadership position should support margins. The management expects operating profit margins to rebound to around 23.5% and operating profit per tonne to reach ₹1,250 if targets are met. The industry expects demand growth at near 8% with further consolidation benefiting large players, where Shree Cement's pricing edge and supply chain efficiency could be useful in the market share competition.
