Shree Cement Q1 FY27 profit drops 17.7% to ₹529 crore on fuel cost surge
Synopsis
Shree Cement's revenue surged 18% in Q1 FY27 — but profits fell 17.7%. The culprit: fuel and raw material costs inflated by the West Asia crisis, which slashed EBITDA margins from 25.2% to 20.4%. With volumes hitting 10.49 million tonnes and premium products at a record 23.3% share, the operational story is strong — the cost story is not.
Key Takeaways
Shree Cement posted a net profit of ₹529 crore in Q1 FY27 , down 17.7 per cent from ₹643 crore in Q1 FY26.
Revenue from operations rose 18 per cent year-on-year to ₹6,233 crore , supported by higher cement dispatches.
EBITDA margin contracted to 20.4 per cent from 25.2 per cent , as fuel and raw material costs surged due to the West Asia crisis .
Cement sales volume grew 17 per cent to 10.23 million tonnes ; total volume including clinker rose 17.2 per cent to 10.49 million tonnes .
Premium products reached 23.3 per cent of trade volumes, up from 17.7 per cent a year ago.
The stock was trading 1.23 per cent lower at ₹26,130 post results, and has fallen more than 15 per cent over the past year.
Shree Cement Limited on 31 July 2025 reported a 17.7 per cent fall in consolidated net profit to ₹529 crore for the first quarter of FY27 (April–June 2025), as elevated fuel and raw material costs eroded margins despite a strong double-digit jump in volumes and revenue.
Profit and Revenue Snapshot
The company's net profit stood at ₹529 crore in Q1 FY27, down from ₹643 crore in the same quarter a year earlier, according to its stock exchange filing. Revenue from operations, however, climbed 18 per cent year-on-year to ₹6,233 crore, compared with ₹5,281 crore in Q1 FY26, driven by higher cement dispatches and improved demand conditions.
Margin Pressure from Fuel and Raw Material Costs
At the operating level, EBITDA declined 4.5 per cent to ₹1,272 crore from ₹1,333 crore in the year-ago period. The EBITDA margin contracted sharply to 20.4 per cent from 25.2 per cent, as per the regulatory filing. Shree Cement attributed the cost escalation to the ongoing West Asia crisis, which has kept fuel and input prices elevated, offsetting the gains from higher sales volumes.
Volume Growth Remains Robust
Despite the margin squeeze, Shree Cement delivered healthy operational metrics. Cement sales volume rose 17 per cent year-on-year to 10.23 million tonnes, while total sales volume — including clinker — grew 17.2 per cent to 10.49 million tonnes. The company's premium product portfolio also gained ground, accounting for 23.3 per cent of trade volumes in the quarter, up from 17.7 per cent in Q1 FY26.
What the Management Said
Managing Director Neeraj Akhoury described the quarter as one characterised by healthy demand, strong volume growth, and continued progress in the company's premiumisation strategy. The shift toward higher-value products is seen as a long-term lever to protect realisations even as input cost cycles remain volatile.
Sustainability Progress and Stock Reaction
Shree Cement also reported a notable improvement in its sustainability metrics. Its Thermal Substitution Rate (TSR) — a measure of alternative fuel usage in place of conventional fossil fuels — rose to 5.1 per cent from 1.9 per cent a year ago, signalling progress on energy efficiency and carbon reduction goals. Following the earnings announcement, the company's shares recovered part of their intra-day losses but were still trading 1.23 per cent lower at ₹26,130 in afternoon trade. The stock has shed more than 15 per cent over the past one year. This comes amid broader sector-level margin stress, as cement makers across India grapple with the twin pressures of elevated energy costs and competitive pricing in key markets.
Point of View
And margin erosion that undermines the headline revenue beat. The West Asia crisis is a convenient external variable, but the EBITDA margin drop from 25.2% to 20.4% in a single year is steep enough to warrant scrutiny of the company's fuel-hedging and procurement strategy. The premiumisation push — with premium products now at 23.3% of trade volumes — is the right long-term call, but it has not yet translated into pricing power sufficient to absorb cost shocks. With the stock already down 15% over the past year, the market is clearly pricing in a prolonged margin recovery cycle, not a quick rebound.
NationPress
31 Jul 2026
Frequently Asked Questions
What was Shree Cement's net profit in Q1 FY27?
Shree Cement reported a consolidated net profit of ₹529 crore in Q1 FY27 (April–June 2025), a decline of 17.7 per cent from ₹643 crore in the same quarter of the previous financial year. Elevated fuel and raw material costs were the primary drag on profitability.
Why did Shree Cement's profits fall despite higher revenue?
Revenue rose 18 per cent to ₹6,233 crore, but fuel and raw material costs — inflated by the ongoing West Asia crisis — outpaced the gains from volume growth. This caused EBITDA margin to contract sharply from 25.2 per cent to 20.4 per cent, pulling net profit lower.
How did Shree Cement's volumes perform in Q1 FY27?
Cement sales volume grew 17 per cent year-on-year to 10.23 million tonnes, and total sales volume including clinker rose 17.2 per cent to 10.49 million tonnes. The volume performance was described by management as reflecting healthy demand conditions.
What is Shree Cement's premiumisation strategy?
Shree Cement has been increasing the share of higher-value premium cement products in its sales mix. In Q1 FY27, premium products accounted for 23.3 per cent of trade volumes, up from 17.7 per cent in Q1 FY26, as the company seeks to improve realisations and protect margins over the medium term.
How did Shree Cement shares react to the Q1 FY27 results?
Following the earnings announcement, Shree Cement shares were trading 1.23 per cent lower at ₹26,130 in afternoon trade on 31 July 2025, recovering part of their intra-day losses. The stock has declined more than 15 per cent over the past one year.
