India Cements reported a 160% year-on-year increase in standalone net profit for the quarter ended September 30, 2026 (Q2FY27), reaching ₹38.85 crore compared to ₹14.93 crore in the corresponding period last year.

The cement manufacturer’s revenue from operations grew 2.2% YoY to ₹1,142.03 crore. The significant jump in bottom-line performance was primarily driven by improved operating margins and a sharp decline in freight and forwarding expenses, which fell from ₹198.10 crore in Q2FY25 to ₹39.98 crore in Q2FY27.

Volume and profitability metrics

According to the company's investor presentation, domestic cement volume rose 16.2% YoY to 2.83 MTPA. This volume growth, coupled with operational efficiencies, led to a 34.3% YoY increase in EBITDA to ₹148 crore. Operating EBITDA per tonne expanded significantly by ₹177/t YoY to reach ₹510/t.

Sales realisation (net of logistics cost) for domestic cement stood at ₹3,798/t in Q2FY27, representing a 1.3% decrease QoQ from ₹3,847/t in Q1FY27.

Standalone financial highlights

The company’s profit before tax (PBT) for the quarter stood at ₹52.31 crore, up from ₹10.48 crore in Q2FY25. The operating margin expanded significantly to 12.66% in Q2FY27 from 7.27% in the year-ago quarter.

For the half-year ended September 30, 2026 (H1FY27), the standalone net profit rose to ₹65.47 crore from ₹7.40 crore in H1FY25. Revenue for the half-year increased marginally to ₹2,161.45 crore from ₹2,141.79 crore.

Cost structure analysis

Key cost indicators reveal mixed trends. Raw material costs decreased 6% YoY to ₹890/t, while power costs fell 14% YoY to ₹527/t. However, fuel costs increased 14% YoY to ₹1,143/t, driven by a shift in fuel mix towards US coal (74%) from pet coke (16%).

Other costs declined 17% YoY to ₹582/t, benefiting from brand transition savings in marketing and operating leverage. Packing costs rose 37% YoY to ₹241/t due to higher raw material costs.

Capacity expansion and ESG updates

India Cements has approved an investment of ₹2,000 crore, with approximately ₹1,728 crore committed as of September 2026. The company plans to expand its cement capacity by 2.8 MTPA, aiming to increase total capacity from 14.45 MTPA in FY25 to 17.55 MTPA by FY28.

On the sustainability front, the renewable energy mix surged to 24.7% in Q2FY27 from 7.1% in Q2FY26. Waste heat recovery system (WHRS) power mix also improved to 6.6% from 5.9%. The company targets scaling up green power (RE+WHRS) to 80% by FY29.

Consolidated performance

On a consolidated basis, the net profit for Q2FY27 was ₹38.82 crore, marking a substantial recovery from the ₹8.81 crore profit in Q2FY25. The consolidated PBT was ₹52.28 crore. Notably, the consolidated results for the previous year’s half-year included exceptional items that resulted in a net loss of ₹124.08 crore, whereas the current half-year posted a net profit of ₹65.67 crore.

What the numbers show

A key driver of the profitability surge is the drastic reduction in freight and forwarding costs, which dropped by 79.8% YoY in the standalone accounts. This cost efficiency, combined with stable revenue, led to a notable expansion in EBITDA margins. Additionally, the company’s debt-equity ratio remained low at 0.16 times, indicating a conservative balance sheet despite an increase in current borrowings to ₹563.34 crore from ₹326.94 crore as on March 31, 2026.

The board meeting, held on October 17, 2026, approved these unaudited financial results. The auditors drew attention to ongoing legal matters, including a provisional attachment order against assets worth ₹120.34 crore and a pending Supreme Court appeal regarding a ₹187.48 crore penalty imposed by the Competition Commission of India.

India Cements has entered into agreements to acquire a 3.62% equity stake in Zenataris Renewable Energy Private Limited for a cash consideration of up to ₹20.90 crore. The move aims to meet the company's green energy needs and optimize energy costs through captive power consumption.

The transaction involves an Energy Supply Agreement and a Share Subscription and Shareholders Agreement. Zenataris is engaged in the generation and transmission of renewable energy, specifically hybrid power. The acquisition is structured to comply with regulatory requirements for captive power consumption under electricity laws.

Target Entity Details

Zenataris Renewable Energy Private Limited is a Special Purpose Vehicle (SPV) incorporated on October 9, 2018, with its registered office in Hyderabad, Telangana. The entity was established to develop and operate an Inter-State Transmission System (ISTS) hybrid renewable energy project located in Kudligi, Vijayanagara District, Karnataka.

Under the agreement, Zenataris will supply 11 MW of renewable energy to India Cements' plants on a group captive basis. This arrangement adheres to the provisions of the Electricity Act, 2003, and related regulations.

Financials of the Target

Zenataris reported its first significant turnover in FY26 after recording nil revenue in the preceding two fiscal years. The acquisition is not classified as a related party transaction, and neither the promoter group nor group companies hold any interest in the target entity.

Transaction Terms and Timeline

The consideration for the equity investment is capped at ₹20,90,00,000 (Rupees Twenty Crore and Ninety Lakhs Only). The payment structure is entirely in cash. The company disclosed that the acquisition is expected to be completed within 120 days from the execution of the relevant agreements.

No specific governmental or regulatory approvals were highlighted as prerequisites for this particular shareholding acquisition in the disclosure, although the underlying project operates under electricity laws.

What the Numbers Show

The data reveals a distinct operational inflection point for the target entity. Zenataris transitioned from zero turnover in FY24 and FY25 to generating ₹7,782.08 lakh in FY26. This sudden revenue generation aligns with the commissioning or operational start of the ISTS hybrid renewable energy project in Karnataka. For India Cements, acquiring a minority stake in this newly operational SPV secures a direct link to this emerging revenue-generating asset while locking in energy costs via the supply agreement.