Birla Corporation (500335) Q2 26/27 earnings summary

Executive summary

• Q2 consolidated revenue was ₹2,415.42 crore, while net profit fell YoY to ₹37.47 crore from ₹90.48 crore; cement results weakened amid higher costs and soft trade pricing.

• Operations ran at 85% capacity utilization; premiumization and cost-control initiatives continued, with management cautious on H2 pricing and demand.

Financial highlights

• Consolidated Q2 revenue was ₹2,415.42 crore vs ₹2,206.53 crore YoY; net profit was ₹37.47 crore vs ₹90.48 crore, and EPS was ₹4.86 vs ₹11.75.

• Consolidated H1 revenue was ₹5,061.87 crore vs ₹4,660.75 crore; net profit was ₹153.20 crore vs ₹210.05 crore, and EPS was ₹19.89 vs ₹27.28.

• Standalone Q2 revenue was ₹1,388.33 crore vs ₹1,229.40 crore; net profit was ₹21.43 crore vs ₹53.12 crore. H1 revenue was ₹2,840.55 crore vs ₹2,658.29 crore; net profit was ₹62.18 crore vs ₹130.99 crore.

• Consolidated Q2 operating margin was 9.59% vs 13.99% YoY and net profit margin was 1.58% vs 4.15%; H1 margins were 11.44% vs 14.15% and 3.07% vs 4.56%, respectively.

• Fuel and packing materials drove cost inflation; purchased clinker following a delayed planned shutdown further raised costs and pressured margins. Q2 packaging cost was INR 240 per ton, down from INR 269 per ton sequentially.

Outlook and guidance

• Fuel cost is expected to rise by ~INR 100 per ton sequentially in Q3; domestic fuel prices may ease in Q4, while petcoke prices may remain elevated or increase.

• October price increases were not yet solid; a potential INR 5–10 per bag increase depended on demand and pricing actions by larger players. Recovery of cost increases and prior EBITDA losses remained uncertain.

• Management maintained the earlier timeline for the upcoming 6.5 million-ton capacity addition; no specific volume-growth or EBITDA forecast was offered.

• Captive coal is expected to meet ~15% of annual fuel needs; current captive coal costs are 20%–25% below market prices.