Ambuja Cements Q2 profit falls 90% as fuel and logistics costs squeeze margins

what happened

Ambuja Cements, part of the Adani Group, reported a 90% year-on-year fall in consolidated net profit to Rs 236 crore for the September quarter, according to TradingView. Higher fuel and logistics costs outweighed an improved mix of trade and premium products. The comparison is also distorted by a high base, as the year-ago quarter included a reversal of income tax provisions worth Rs 1,697 crore.

Revenue was almost flat at Rs 9,197 crore against Rs 9,175 crore a year earlier. Operating EBITDA fell 28%, and the EBITDA margin contracted from 19.2% to 13.8%. Cement sales volume was 16.5 million tonnes, close to last year's 16.6 million. The company also said prices had risen by Rs 10-15 per bag and that further increases are possible.

why it matters

For markets, the results show that energy and transport costs are currently outweighing pricing gains, which pressures margins across India's cement sector. Shares of Ambuja Cements, ACC and Orient Cement remain sensitive to cost trends and to the planned merger, which the company says should be accretive to earnings per share.

market impact

Ambuja Cements shares: higher costs and lower margins weigh on the stock

• ▼Ambuja Cements shares pressure down — net profit fell 90% and the EBITDA margin shrank to 13.8%

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instruments