Star Cement (540575) Q3 24/25 earnings summary

Executive summary

• Cement and clinker sales volume grew 10% year-over-year in Q3 FY25, reaching 10.68 lakh tons, with Northeast sales up and outside Northeast slightly down.

• Revenue for Q3 FY25 rose to ₹719 crore from ₹651 crore year-over-year, but EBITDA and PAT declined sharply due to higher depreciation, one-off costs, and margin compression.

• New clinker and grinding units faced stabilization issues, impacting profitability and requiring external clinker purchases.

• Unaudited standalone and consolidated financial results for the quarter and nine months ended December 31, 2024, were approved by the Board on January 30, 2025.

• Statutory auditors issued an unmodified review report for both standalone and consolidated results, indicating no material misstatements.

Financial highlights

• Q3 FY25 revenue: ₹719 crore (vs. ₹651 crore YoY); 9M FY25 revenue: ₹2,111 crore (vs. ₹1,997 crore YoY); standalone revenue for Q3 FY25 was ₹45,115.99 lakhs.

• Q3 FY25 EBITDA: ₹107 crore (vs. ₹153 crore YoY); per ton EBITDA for Q3 FY25: ₹1,007 (vs. ₹1,582 YoY); 9M FY25 EBITDA: ₹321 crore (vs. ₹395 crore YoY).

• Q3 FY25 PAT: ₹9 crore (vs. ₹74 crore YoY); 9M FY25 PAT: ₹46 crore (vs. ₹207 crore YoY); standalone net profit for Q3 FY25 was a loss of ₹4,430.85 lakhs; consolidated net profit was ₹905.95 lakhs.

• One-off costs in Q3: ₹40 crore (₹30 crore for clinker purchase, ₹10 crore shutdown cost); depreciation expense rose 145% year-over-year.

• Earnings per share (EPS) for Q3 FY25 (standalone) was ₹(1.10), compared to ₹1.40 in Q3 FY24.

Outlook and guidance

• Expecting 7%-8% volume growth for FY25 and 10% in Q4; projecting 12%-15% growth for FY26; expansion plans to increase cement capacity to 12 MTPA by FY27.

• EBITDA for FY25 projected at ₹225-₹230 crore, with Q4 expected to be stronger as one-off costs subside.

• 12 MW new WHRS and AFR processing unit to be commissioned in Q4 FY25 to optimize power costs; green energy share targeted at 55% by FY26.

• Northeast prices expected to remain stable or slightly positive; outside Northeast prices have stabilized after earlier declines.

• SCNEL subsidiary commenced cement production at its Guwahati grinding unit on March 12, 2024, and opted for a lower income tax rate under section 115BAB.