Kolkata-headquartered Shree Cement Ltd. released its March quarter (Q4 FY25) results on May 14, and the stock responded positively, trading up nearly 2% post-announcement. Despite a 16% year-on-year decline in net profit to ₹556 crore, the figure surpassed market expectations set by a CNBC-TV18 poll, which had predicted a profit of ₹524 crore.

Revenue performance also surprised positively. The company posted a 3% year-on-year increase in revenue to ₹5,240 crore, beating the CNBC-TV18 estimate of ₹4,999 crore, which had predicted a marginal decline. This indicates robust operational execution even in the face of sector-wide challenges such as input cost inflation and uneven cement demand in certain regions.

EBITDA Beats Expectations; Margins Expand Slightly

Another notable highlight was the performance on the EBITDA (Earnings Before Interest, Tax, Depreciation, and Amortization) front. Shree Cement reported an EBITDA of ₹1,381 crore, a 4.1% year-on-year increase, well ahead of the CNBC-TV18 estimate of ₹1,298 crore. The EBITDA margin improved by 20 basis points to 26.36%, compared to 26.17% in the same period last year, reflecting stable pricing and cost discipline.

This margin expansion, though modest, signals a resilient operating model. Market participants were anticipating margin compression due to elevated energy and logistics costs, but the results show that the company managed to offset some of these pressures through operational efficiency.

Volume Growth and Premiumization Drive Performance

One of the most encouraging signs in the results was the strong volume performance. The company achieved its highest-ever quarterly cement and clinker sales volume at 9.84 million tonnes, indicating solid demand momentum and an efficient supply chain strategy.

Adding to the positives was the rise in premium product contribution. Premium products formed 15.6% of the trade sale volume, up from 11.9% in the same quarter last year. This shift aligns with the company’s strategic premiumization focus, which not only helps in brand positioning but also leads to higher profitability per tonne.

Dividend Declaration and Shareholder Returns

Shree Cement’s board announced a final dividend of ₹60 per share, in addition to the ₹50 per share dividend declared in February last year. This brings the total dividend payout to ₹110 per share in the last 14 months, underlining the company’s commitment to rewarding shareholders even during a moderately challenging year.

The dividend decision reflects the strong cash position and confidence in future cash flows, despite a drop in net earnings.

Capacity Expansion and Growth Outlook

The company’s total installed cement production capacity now stands at 62.8 MTPA after commissioning two new grinding units—one in Etah, Uttar Pradesh and another in Baloda Bazar, Chhattisgarh. These additions are part of its long-term capacity ramp-up plan aimed at increasing its geographic reach and production efficiency.

Shree Cement also has ongoing projects at its integrated cement units in Jaitran, Rajasthan, and Kodla, Karnataka, which are scheduled to be commissioned in Q1 and Q2 of FY26, respectively. Interestingly, of the two cement mills planned at Jaitran, only one will be commissioned for now, with the second unit to follow at a later date, according to the company’s statement.

This phased commissioning strategy suggests a calibrated approach to capex deployment, balancing expansion with market demand dynamics.

Leadership Commentary and Strategic Vision

Managing Director Neeraj Akhoury expressed confidence in the company’s future performance. He said, "As we move into FY26, we remain optimistic about improved cement demand and will therefore continue to drive our strategic initiatives of premiumization, geo-mix and cost optimization. We remain committed to growth, sustainability, and value creation for our stakeholders."

This statement reaffirms the company’s focus on sustainable growth and highlights three strategic pillars:

• Premiumization for better margins

• Geo-mix to diversify risk and reach

• Cost optimization to improve operational leverage

Stock Performance and Market Sentiment

Following the result announcement, shares of Shree Cement rose 1.9%, trading at ₹30,710, just shy of its all-time high of ₹31,415. The stock has already gained over 20% in 2025, making it one of the best-performing cement stocks so far this year.

Market analysts attribute this positive sentiment to:

• Stronger-than-expected operational performance

• Consistent volume growth

• Healthy dividend payouts

• Clarity on upcoming capacity additions

With these positives, Shree Cement is well-positioned to benefit from expected demand recovery in FY26, supported by infrastructure spending and government initiatives.

Final Thoughts

While profitability dipped, Shree Cement’s Q4 performance showcased resilience and strategic focus. The beat on revenue, EBITDA, and margins, along with record-high volume and increasing premium product contribution, reflects strong execution and a clear growth roadmap.

Investors seem confident in the company’s capacity expansion, dividend policy, and demand tailwinds, especially as the broader construction and infrastructure sectors recover. The company’s strategic projects and phased commissioning approach further ensure capital discipline and sustainable expansion.

In conclusion, Shree Cement has delivered a balanced quarterly performance, and its outlook for FY26 remains robust, driven by both organic growth and strategic execution.

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