Ramco Cements Q1 FY27 profit crashes 63% to ₹32 crore on cost surge
Synopsis
Ramco Cements posted a 63% profit crash to ₹32 crore in Q1 FY27 even as revenues rose nearly 10% — a textbook margin squeeze driven by West Asia-linked fuel costs, a new Tamil Nadu limestone levy of ₹160 per tonne, and a 5% slide in cement realisations. Volume growth of 12% kept the operational story intact, but the cost story is the one that matters right now.
Key Takeaways
Ramco Cements net profit fell 62.8 per cent to ₹32 crore in Q1 FY27 , down from ₹86 crore in Q1 FY26 .
Revenue from operations rose 9.6 per cent year-on-year to ₹2,269 crore , supported by volume growth.
EBITDA declined 22.7 per cent to ₹307 crore ; EBITDA margin contracted to 13.5 per cent from 19.23 per cent .
Cement sales volume grew 12 per cent to 4.48 million tonnes despite election-related demand disruptions.
The Tamil Nadu limestone land tax (effective April 2025 ) added ₹39 crore to costs — equivalent to ₹84 per tonne of cement.
Blended EBITDA per tonne fell to ₹681 from ₹981 a year ago.
Ramco Cements Limited reported a sharp 62.8 per cent year-on-year fall in net profit to ₹32 crore for the first quarter of FY27 (April–June 2025), as elevated fuel and packing material costs, compounded by weaker cement realisations, eroded margins despite healthy volume growth. The results were disclosed in the company's stock exchange filing on Friday, 7 August 2025.
Revenue Grows, But Profits Collapse
Revenue from operations climbed 9.6 per cent year-on-year to ₹2,269 crore in Q1 FY27, up from ₹2,070 crore in the corresponding quarter of FY26. However, the top-line improvement failed to translate into bottom-line gains, with net profit sliding from ₹86 crore to ₹32 crore over the same period.
Margins Under Severe Pressure
Operating performance deteriorated sharply. EBITDA fell 22.7 per cent to ₹307 crore from ₹398 crore in Q1 FY26, while the EBITDA margin contracted to 13.5 per cent from 19.23 per cent a year earlier. Blended EBITDA per tonne dropped to ₹681 from ₹981, reflecting the twin squeeze of rising input costs and a 5 per cent year-on-year decline in cement realisations.
The company attributed the profitability decline primarily to higher fuel and packing material costs, which it linked to the ongoing West Asia conflict, alongside softer pricing in the cement market.
Volume Growth Offers a Silver Lining
Despite the margin compression, Ramco Cements delivered operationally sound volume numbers. Cement sales volume rose 12 per cent to 4.48 million tonnes in Q1 FY27, up from 4 million tonnes in the year-ago quarter. The company noted this growth was achieved even as state elections in Tamil Nadu, Kerala, and West Bengal caused temporary demand disruptions.
Cement capacity utilisation improved to 70 per cent from 68 per cent a year ago. The construction chemicals segment also showed strength, with sales volume rising 13 per cent to 1.35 lakh tonnes from 1.20 lakh tonnes in Q1 FY26.
Tamil Nadu Limestone Tax Adds to Cost Burden
A significant new cost headwind emerged from the Tamil Nadu government's mineral-bearing land tax on limestone, which came into effect from April 2025. The levy of ₹160 per tonne of limestone added ₹39 crore to variable costs during the quarter, translating into an incremental burden of ₹84 per tonne of cement produced — a structural cost increase that will continue to weigh on margins in coming quarters.
What to Watch
With input cost pressures showing no immediate signs of easing and cement realisations remaining soft, the trajectory of profitability in Q2 FY27 will depend heavily on whether pricing recovers in key southern markets. Industry watchers will also monitor how the limestone tax and fuel cost dynamics evolve through the rest of the financial year.
Point of View
It is a permanent structural cost addition, not a cyclical headwind. Ramco's southern market concentration makes it more exposed than peers to state-level fiscal decisions. The real question is whether the company can pass on costs through price hikes in a market where realisations are already down 5% — and in an industry where pricing discipline has historically been fragile.
NationPress
7 Aug 2026
Frequently Asked Questions
What were Ramco Cements' Q1 FY27 results?
Ramco Cements reported a net profit of ₹32 crore in Q1 FY27 (April–June 2025), a 62.8 per cent decline from ₹86 crore in Q1 FY26. Revenue from operations rose 9.6 per cent to ₹2,269 crore, but higher costs and weaker cement realisations eroded profitability.
Why did Ramco Cements' profit fall so sharply?
The profit decline was driven by higher fuel and packing material costs linked to the West Asia conflict, a 5 per cent year-on-year drop in cement realisations, and a new Tamil Nadu government limestone land tax that added ₹39 crore to costs during the quarter.
What is the Tamil Nadu limestone tax and how does it affect Ramco Cements?
The Tamil Nadu government's mineral-bearing land tax on limestone, effective from April 2025, levies ₹160 per tonne of limestone extracted. For Ramco Cements, this translated into an additional variable cost of ₹39 crore in Q1 FY27, or ₹84 per tonne of cement produced.
How did Ramco Cements' volumes perform in Q1 FY27?
Cement sales volume grew 12 per cent to 4.48 million tonnes from 4 million tonnes in Q1 FY26, despite temporary demand disruptions from state elections in Tamil Nadu, Kerala, and West Bengal. Construction chemicals volume also rose 13 per cent to 1.35 lakh tonnes.
What is Ramco Cements' EBITDA margin for Q1 FY27?
The EBITDA margin contracted to 13.5 per cent in Q1 FY27, down from 19.23 per cent in the same quarter last year. EBITDA fell 22.7 per cent to ₹307 crore, with blended EBITDA per tonne dropping to ₹681 from ₹981.
