Cement firms to see 21% slump in Q1 Ebitda/tonne: Jefferies
Cement

Cement firms to see 21% slump in Q1 Ebitda/tonne: Jefferies

With a significant rise in input costs, the cement sector could experience a steep decline in its operating profit per tonne in the first quarter (Q1) of financial year 2022-23 (FY23), compared to a year ago. In fact, the year-on-year decline would be the deepest in the past 10 years.

Jefferies estimated that the average Ebitda/t for this quarter for cement companies under its coverage will decline by around Rs 451 year-on-year/Rs 45 quarter-on-quarter to Rs 958 (the YoY decline would be one of the highest in the past 10 years). Despite revival in volumes, an increase in input costs weighed on margins. International pet coke and coal prices are up 25-30% QoQ for Q1FY23. The brokerage’s analysts expect the increase in energy prices to reflect to some extent in Q1FY23, and its full impact to be felt in Q2FY23.

“We expect cement to report a 21% YoY Ebidta decline for 1QFY23 … the fall reflects lag in passing costs even as volume growth recovers to mid-teens YoY (soft base),” said the brokerage’s analysts in a recent report.

Companies have struggled to pass on the costs, especially those with exposure to the southern markets.

Also Read:
K Lakshmi launches new brand in central and eastern UP
Shree Cement to set up integrated cement unit in Guntur


With a significant rise in input costs, the cement sector could experience a steep decline in its operating profit per tonne in the first quarter (Q1) of financial year 2022-23 (FY23), compared to a year ago. In fact, the year-on-year decline would be the deepest in the past 10 years. Jefferies estimated that the average Ebitda/t for this quarter for cement companies under its coverage will decline by around Rs 451 year-on-year/Rs 45 quarter-on-quarter to Rs 958 (the YoY decline would be one of the highest in the past 10 years). Despite revival in volumes, an increase in input costs weighed on margins. International pet coke and coal prices are up 25-30% QoQ for Q1FY23. The brokerage’s analysts expect the increase in energy prices to reflect to some extent in Q1FY23, and its full impact to be felt in Q2FY23. “We expect cement to report a 21% YoY Ebidta decline for 1QFY23 … the fall reflects lag in passing costs even as volume growth recovers to mid-teens YoY (soft base),” said the brokerage’s analysts in a recent report. Companies have struggled to pass on the costs, especially those with exposure to the southern markets. Also Read: K Lakshmi launches new brand in central and eastern UPShree Cement to set up integrated cement unit in Guntur

Related Stories

Gold Stories

Next Story
Products

Koemmerling opens Navi Mumbai experience centre

Koemmerling, a brand of the profine Group, has expanded its presence in the Mumbai metropolitan region with the opening of a new experience centre in Navi Mumbai and launched its Allure S46 minimal sliding door system for the Indian market.Located in CBD Belapur, the facility was inaugurated by Peter Mrosik, Owner and CEO, profine Group, along with Farid Khan, Chairman and Managing Director, profine India, and Kamal Bajaj, CEO, profine India.The company said the new centre will showcase its portfolio of uPVC and aluminium window and door systems to architects, developers and homeowners.The ina..

Next Story
Products

India's waterproofing market nears Rs 150 bn milestone

India's waterproofing industry is approaching a market size of Rs 150 billion and is expected to surpass the $2 billion milestone, according to speakers at the 2nd India International Waterproofers Conference & Expo 2026 organised by the Waterproofers Association of India (WAI) in New Delhi.The two-day event brought together more than 20 speakers, 55 international delegates and 53 exhibition booths, with discussions focusing on climate-resilient construction, advanced waterproofing technologies and international collaboration.Inaugurating the event, Durga Shanker Mishra, former Secretary, ..

Next Story
Real Estate

Dilip Buildcon Q1 FY27 Revenue at Rs 23.78 billion

Dilip Buildcon Limited reported consolidated revenue from operations of Rs 2,378 crore in Q1 FY27, along with EBITDA of Rs 429 crore and profit after tax of Rs 128 crore.Consolidated EBITDA margin stood at 18.1%, improving from 17.1% in Q4 FY26. On a standalone basis, revenue from operations was Rs 1,930 crore, EBITDA stood at Rs 199 crore and PAT was Rs 39 crore, with an EBITDA margin of 10.3%.The company’s order book stood at Rs 27,691 crore as of 30 June 2026, compared with Rs 28,830 crore as of 31 March 2026. Roads and highways accounted for 17.1% of the order book, irrigation and water ..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement