Synopsis:
Ramco Cement reported a 13% QoQ revenue decline but a 230% QoQ profit growth in Q1 FY26. Cement volumes dipped 7% YoY; capex, capacity expansion, and asset monetisation efforts remain on track.
Shares of a company engaged in manufacturing cement, ready mix concrete (RMC) and dry mortar products moved down by nearly 6.4 percent on Friday, despite reporting financial results for Q1 FY26 with a PAT growth of around 230 percent QoQ and 131 percent YoY.
At 11:50 a.m., the shares of The Ramco Cements Limited were trading in the red at Rs. 1,068.05 on BSE, down by around 6 percent, as against its previous closing price of Rs. 1,136.15, with a market cap of Rs. 25,237 crores. The stock has delivered positive returns of over 34 percent in the last one year, but has gained by around 19 percent in the last six months.
What’s the News
According to the latest regulatory filings on the stock exchanges, The Ramco Cement Limited announced the financial results for Q1 FY26 on Thursday after market hours.
For Q1 FY26, Ramco Cement reported a consolidated revenue from operations of Rs. 2,074 crores, marking around a 13 percent QoQ decline compared to Rs. 2,397.3 crores in Q4 FY25, and a year-on-year decrease of about 1 percent from Rs. 2,093.5 crores recorded in Q1 FY25.
Net profit for the quarter stood at Rs. 84.6 crores, marking a growth of around 230 percent QoQ compared to Rs. 25.6 crores in Q4 FY25, as well as a year-on-year increase of about 131 percent from Rs. 36.6 crores in Q1 FY25.
As per standalone results, cement sales volume in Q1 FY26 stood at 4 million tons, down 7 percent YoY from 4.29 million tons in Q1 FY25, primarily due to weak demand caused by early monsoon rains in Kerala and unseasonal rainfall in the eastern markets, where several infrastructure projects are nearing completion.
The company plans to achieve a cement capacity of 30 MTPA by March 2026 with the commissioning of a second line in Kolimigundla, along with debottlenecking and additional grinding capacity at existing sites with minimal capex. The railway siding at Kolimigundla was commissioned in July 2025, with initial inward and outward movements completed.
In RR Nagar, 5 MW of the Waste Heat Recovery System (WHRS) is set to be commissioned in August 2025, with the remaining 5 MW expected in September 2025. At Kolimigundla, 15 MW of WHRS capacity will be commissioned along with Kiln Line-2 in FY27. The Construction Chemicals unit in Odisha was commissioned in July 2025. For the proposed greenfield project in Karnataka, the company has acquired 57 percent of the mining land and 13 percent of the factory land. During Q1 FY26, the company incurred a capex of Rs. 321 crores, including maintenance capex. The capex guidance for FY26 is expected at Rs. 1,200 crores.
The company has monetised Rs. 501 crore of non-core assets against a Rs. 1,000 crore target. The remaining is expected to be completed by September 2025, pending regulatory approvals. Total debt as of 30th June 2025 stood at Rs. 4,734 crore compared to Rs. 4,652 crore recorded in 31st March 2025. The cost of debt for Q1 FY26 declined to 7.64 percent from 7.92 percent in Q1 FY25.
Further, the stock is currently trading at a price-to-earnings (P/E) of 188, significantly higher than the industry average of 51.5, suggesting a potential overvaluation relative to its peers.
The Ramco Cements Limited is engaged in the business of manufacturing cement, ready mix concrete, dry mortar, and construction chemicals, serving mainly the domestic markets. The company is a major player in the blended cement category in South India and is the fifth-largest cement producer in the country.
Written by Shivani Singh
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