Ambuja Cements reported a 90% year-on-year decline in consolidated net profit to ₹236 crore for the second quarter of FY2027, as higher fuel, freight and packaging costs weighed on its operating performance. Revenue from operations remained broadly flat at ₹9,197 crore, while operating EBITDA fell 28% to ₹1,271 crore. The Adani Group company also faced a high comparison base because the year-ago quarter included a substantial income-tax provision reversal.
The results highlight the pressure facing cement manufacturers as energy and logistics expenses rise. Although Ambuja improved its trade-sales mix and increased the share of premium products, those gains were not sufficient to prevent a sharp contraction in operating margins. The company is now relying on cost-reduction initiatives, higher-value sales and additional production capacity to strengthen performance in the second half of FY2027.
Key Takeaways
- Consolidated net profit: Fell 90% year over year to ₹236 crore.
- Revenue: Increased marginally to ₹9,197 crore from ₹9,175 crore.
- Operating EBITDA: Declined 28% to ₹1,271 crore.
- EBITDA margin: Contracted to 13.8% from 19.2%.
- Sales volume: Reached 16.5 million tonnes, compared with 16.6 million tonnes a year earlier.
- Cost pressure: Higher petcoke, coal, diesel, freight and packaging expenses weighed on profitability.
- Merger development: Shareholders approved the proposed amalgamation of ACC and Orient Cement with Ambuja Cements, subject to further approvals.
Ambuja Cements Q2 FY27 Results: Financial Performance
The September quarter showed a clear difference between revenue performance and profitability. While revenue remained almost unchanged, operating earnings declined considerably as costs absorbed a larger share of sales.
Consolidated quarterly results
| Financial metric | Q2 FY27 | Q2 FY26 | Year-on-year change |
|---|---|---|---|
| Revenue from operations | ₹9,197 crore | ₹9,175 crore | Approximately +0.2% |
| Net profit | ₹236 crore | Approximately ₹2,297 crore | -90% |
| Operating EBITDA | ₹1,271 crore | ₹1,762 crore | -28% |
| EBITDA margin | 13.8% | 19.2% | -5.4 percentage points |
| EBITDA per tonne | ₹770 | ₹1,061 | Approximately -27.4% |
| Cement sales volume | 16.5 million tonnes | 16.6 million tonnes | Approximately -0.6% |
Source: Moneycontrol’s October 29, 2026 report. Figures are rounded where appropriate.
The figures show that Ambuja’s earnings pressure was not driven by a major fall in cement sales volumes alone. Instead, the combination of elevated input costs and weaker operating margins played a central role.
Revenue increased by just ₹22 crore compared with the year-ago quarter, while operating EBITDA declined by ₹491 crore. The gap indicates that the company struggled to convert broadly stable sales into operating earnings.
Why Did Ambuja Cements’ Profit Fall 90%?
Two factors explain the sharp fall: a high comparison base and higher operating expenses.
1. A significant tax-related benefit in the base quarter
The September 2025 quarter included a reversal of income-tax provisions worth ₹1,697 crore, according to Moneycontrol. This exceptional benefit boosted the previous year’s reported profit.
Consequently, the 90% year-on-year decline in consolidated net profit should not be interpreted as a direct measure of the deterioration in underlying operations. The prior-year figure benefited from a substantial tax-related item, making the comparison unusually difficult.
However, the operating figures also show genuine pressure. EBITDA fell 28%, and the margin contracted by 5.4 percentage points. Even after accounting for the exceptional comparison, the company’s core profitability faced significant challenges.
2. Higher fuel and logistics expenses
Cement manufacturing is energy-intensive. Coal and petcoke are important fuels for production, while diesel and freight influence the cost of moving raw materials and finished cement.
Ambuja said higher petcoke and coal prices, constrained coal availability, increased diesel expenses and packaging costs continued to weigh on industry margins.
These costs can rise faster than cement prices, particularly when competition limits manufacturers’ ability to pass the increases on to customers. The result is lower EBITDA per tonne and reduced operating profitability.
EBITDA Margin Contracts as Costs Rise
Ambuja’s operating EBITDA margin declined from 19.2% in Q2 FY26 to 13.8% in Q2 FY27.
| Profitability indicator | Q2 FY26 | Q2 FY27 | Change |
|---|---|---|---|
| EBITDA margin | 19.2% | 13.8% | -5.4 percentage points |
| EBITDA per tonne | ₹1,061 | ₹770 | -₹291 |
| Total cost per tonne | — | ₹4,410 | Q2 FY27 figure |
The fall in EBITDA per tonne is particularly relevant for a cement producer because it indicates how much operating earnings the company generates from each tonne sold.
Ambuja reported a total cost of ₹4,410 per tonne during the quarter. The company said this would have been ₹4,182 per tonne excluding the impact of geopolitical conflicts. It is targeting a cost of ₹4,250 per tonne by FY2027.
Achieving that target would require further operational efficiencies and relief from cost pressures. The actual outcome will depend on energy prices, freight expenses, production efficiency and the company’s ability to improve capacity utilisation.
Premium Products and Trade Sales Offer Some Support
Despite the difficult quarter, Ambuja reported improvements in its product and distribution mix.
Trade volumes increased 8.6% year over year, with trade sales accounting for 74% of total volumes—six percentage points higher than a year earlier. Premium products represented 37% of trade sales, compared with 35% in the corresponding quarter.
A stronger premium mix can improve revenue quality because premium cement products may command better realisations than standard products. Trade sales can also help a manufacturer build a more diversified distribution network.
However, these improvements have not fully offset the effect of rising costs. The decline in EBITDA per tonne suggests that the benefits of a better product mix were outweighed by input-cost inflation and other operating pressures during the quarter.
Ambuja expects cement volumes to grow ahead of the industry in the second half of FY2027, supported by stronger trade sales and a calibrated approach to institutional business.
Capacity Expansion Continues
Ambuja continued to expand its production footprint during the September quarter.
The company commissioned 4.6 million tonnes per annum of capacity through projects at Dahej, Salai Banwa and Kalamboli. Another 3.2 million tonnes per annum at Bathinda and Jodhpur Penna is being stabilised and ramped up, while 2.4 million tonnes per annum at Warisaliganj is expected to be commissioned in the second half of FY2027.
Additional capacity can strengthen Ambuja’s ability to serve growing markets and capture demand from infrastructure and housing projects. However, capacity expansion alone does not guarantee higher profitability. Newly commissioned plants need to achieve efficient utilisation, while transport distances and regional competition can influence delivered costs.
The company’s challenge is to convert its expanding production base into sustainable earnings rather than pursue volume growth at the expense of margins.
ACC and Orient Cement Merger Moves Forward
Separately, shareholders approved the proposed amalgamation of ACC and Orient Cement with Ambuja Cements. The schemes will now proceed through the National Company Law Tribunal process and remain subject to the required regulatory and statutory clearances.
The consolidation is expected to bring the group’s cement operations under a more unified structure. Management has said the proposed merger is expected to be earnings-per-share accretive, although the eventual benefits will depend on integration, operating efficiencies and the final implementation of the schemes.
Ambuja reported a net worth of ₹72,238 crore, cash and cash equivalents of ₹1,070 crore, and a debt-free balance sheet at the end of the quarter, according to Moneycontrol. These figures provide context for its financial position as it continues expansion and integration efforts.
The Bigger Picture
Ambuja Cements’ Q2 FY27 results reflect a broader challenge for cement manufacturers: demand and sales can remain relatively stable even as profitability weakens because of rising fuel, freight and packaging expenses. In this quarter, the sharp fall in reported profit was amplified by a tax benefit in the previous year’s comparison period, but lower EBITDA and narrower margins demonstrate that operating pressures remain substantial.
The company’s next phase will depend on its ability to reduce costs, improve plant utilisation, sustain premium-product growth and benefit from price increases. Infrastructure investment, housing demand and urbanisation could support cement consumption, but the timing and extent of any recovery in margins will depend on energy costs and market pricing conditions.
FAQs
1. What was Ambuja Cements’ Q2 FY27 net profit?
Ambuja Cements reported consolidated net profit of ₹236 crore for the September quarter of FY2027, down 90% year over year, according to Moneycontrol.
2. Why did Ambuja Cements’ profit fall so sharply?
Higher fuel, freight, diesel and packaging costs reduced operating profitability. The year-on-year decline was also amplified by a ₹1,697 crore income-tax provision reversal in the year-ago quarter.
3. What was Ambuja Cements’ revenue in Q2 FY27?
Revenue from operations was ₹9,197 crore, compared with ₹9,175 crore in Q2 FY26.
4. What happened to Ambuja Cements’ EBITDA margin?
The operating EBITDA margin fell to 13.8% from 19.2% a year earlier, a contraction of 5.4 percentage points.
5. What is Ambuja Cements’ cost-reduction target?
Ambuja is targeting a cost of ₹4,250 per tonne by FY2027. Its reported total cost was ₹4,410 per tonne in Q2 FY27.
Looking Ahead
Ambuja Cements’ near-term performance will depend on whether it can reduce fuel and logistics expenses while sustaining the benefits of its premium-product mix. The company’s capacity additions and expected growth in trade sales could support volumes in the second half, but a lasting improvement in profitability will require better cost control and favourable pricing conditions.
Investors and industry observers will also be watching the progress of the ACC and Orient Cement merger, the stabilisation of recently commissioned capacity and the company’s progress toward its cost target. These developments will help determine whether Ambuja can restore margins while expanding its position in India’s cement market.
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