Ambuja Cements Q4 profit jumps 78%, but margin pressure clouds record revenue, volume show

Ambuja Cements posted a sharp rise in consolidated net profit for the March quarter, helped by higher revenue and tax-related gains, even as operating profitability weakened due to fuel, diesel, packaging and currency-led cost pressures.

Ambuja Cements Ltd reported a 78.47% year-on-year rise in consolidated net profit attributable to owners of the parent at ₹1,830.15 crore for the quarter ended March 31, 2026, compared with ₹1,025.49 crore in the year-ago period.

Revenue from operations rose 10.1% YoY to ₹10,891.68 crore, against ₹9,894.41 crore a year earlier. The company’s press release said it delivered its “highest ever quarterly revenue” and “highest ever sales volume” in Q4FY26.

However, the operating performance was weak. EBITDA declined 21.6% YoY to ₹1,463.91 crore, compared with ₹1,867.55 crore last year. EBITDA margin contracted to 13.41% from 18.71%, reflecting pressure on profitability despite higher sales.

Margin pressure

The margin contraction was the key weak spot in the quarter.

Ambuja directly flagged cost pressures as a drag on performance, saying “fuel, diesel, packaging bag supply constraints, and rupee depreciation” impacted the quarter and that the impact is expected to continue in the first half of FY27.

The company’s cost table showed kiln fuel cost rising to ₹1.61/’000 kCal in Q4FY26 from ₹1.58/’000 kCal in Q4FY25, while power cost remained flat at ₹5.9/kWh. Ambuja attributed the higher fuel cost in Q4 to the prevailing energy situation arising from geopolitical events.

The company said it is countering these pressures through fuel mix optimisation, higher renewable energy usage, reduction in logistics costs through rail and sea movement, and disciplined production and inventory management. It also said it will prioritise higher-margin markets.

The pressure was visible in unit profitability as well. Ambuja’s EBITDA per tonne fell to ₹735 in Q4FY26 from ₹1,028 in Q4FY25, even as sales volume increased to 19.9 million tonnes from 18.2 million tonnes a year earlier.

Jump in profit

The headline profit growth was strong, but it came despite a fall in operating profit.

Ambuja’s net profit attributable to owners rose nearly 78% YoY, but EBITDA fell more than 21%, indicating that the profit jump was supported by below-EBITDA items, including tax-related movements.

In the standalone results, Ambuja reported a total tax credit of ₹1,462.08 crore in Q4FY26, compared with a tax expense of ₹385.93 crore in Q4FY25. The company said it reassessed certain tax positions after favourable High Court decisions and reversed provisions that were no longer required to be carried in the books.

This means the quarter was not a clean operating beat. The company delivered higher revenue and record volumes, but the core earnings print was hit by cost inflation and lower margins.

Management commentary

Ambuja Cements whole-time director and CEO Vinod Bahety said FY26 was a year of resilience for the cement sector amid consolidation, GST reforms, adverse weather conditions, geopolitical factors and state elections.

Bahety said, “Against this backdrop, Ambuja Cements delivered a resilient performance for the year with highest ever annual volume of 73.7 MnT, revenue of Rs 40,656 Cr, EBITDA at Rs 6,539 Cr (Rs 887 PMT) and normalised PAT of Rs 2,647 Cr.”

For the March quarter, he said the company sustained performance with volume of 19.9 MnT, revenue of ₹10,915 crore and EBITDA of ₹1,464 crore.

Bahety added that volumes grew ahead of the industry, supported by improved realisations, a higher share of trade and premium products, and better utilisation of existing assets.

He also said FY26 marked a “transition from expansion to consolidation”, with the successful merger of Sanghi and Penna Cement with Ambuja.

Premiumisation, green power offer some cushion

There were positives on the operating side, even though they were not enough to offset the full cost impact.

Premium products rose to 36% of trade sales in Q4FY26 from 32% a year earlier. Green power share increased to 32% from 26% in Q4FY25, while direct dispatch remained steady at 61%.

These are important operating levers for Ambuja as it tries to protect profitability through premiumisation, renewable energy and logistics efficiency. However, the steep margin fall shows these levers were not sufficient to fully absorb the pressure from fuel, packaging, diesel and currency-related costs during the quarter.

Balance sheet, dividend and capacity

Ambuja said it continues to remain debt-free, with net worth of ₹71,846 crore and cash and cash equivalents of ₹1,770 crore.

The board recommended a dividend of ₹2 per equity share for FY26, subject to shareholder approval. The company has fixed June 12, 2026 as the record date, and the dividend, if approved, will be paid on or after July 1, 2026, subject to tax deduction.

On capacity, Ambuja said its total cement capacity increased to 109 MTPA during FY26, supported by the commissioning of 10.7 MTPA of new grinding units and 7 MTPA of additional clinker capacity. The company expects capacity to increase to around 119 MTPA with projects scheduled for commissioning in H1FY27.

The company said cement demand remained strong through FY26, but FY27 demand growth is expected to remain soft at around 5%, factoring in early forecasts of a below-normal monsoon and ongoing West Asia conflict-led fuel price volatility.

Bahety said, “While India’s long-term infrastructure growth story remains fundamentally strong, the outlook for FY’27 growth remains soft due to current geopolitical challenges and early forecast of below normal monsoon. We expect industry demand at ~5% for FY27.”

For Ambuja, the next few quarters will hinge on whether record volumes and capacity expansion can translate into stronger operating leverage once cost pressures ease.

Shares of Ambuja Cements ended flat at ₹444.60 apiece on the NSE on Monday. The stock has declined over 15% in the past year, underperforming the Nifty Next 50 index, which has gained nearly 9% during the same period.