Sagar Cements Q2 FY26 results: net loss narrows to ₹44.17 crore, revenue up 26.7%

How did Sagar Cements perform in Q2 FY26?

Sagar Cements reported consolidated revenue of ₹601.86 crore for Q2 FY26, up ₹126.74 crore or 26.7% from ₹475.12 crore in Q2 FY25. EBITDA rose ₹31.40 crore or 157.6% to ₹51.33 crore, and the EBITDA margin widened by 4.3 percentage points to 8.5% from 4.2%. The company reported a net loss of ₹44.17 crore, compared with a net loss of ₹56.98 crore, while basic EPS improved to -₹3.38 from -₹4.36.

Against Q1 FY26, revenue fell ₹68.80 crore or 10.3% from ₹670.66 crore, while EBITDA fell ₹70.12 crore or 57.7% from ₹121.45 crore. The EBITDA margin declined by 9.6 percentage points to 8.5% from 18.1%. Profit before tax moved to a loss of ₹46.51 crore from ₹23.90 crore, the net loss was ₹44.17 crore versus a net profit of ₹7.49 crore, and basic EPS was -₹3.38 against ₹0.57.

The filing also reported standalone Q2 FY26 revenue of ₹399.51 crore, up 21.2%, with a loss before tax of ₹27.29 crore and a net loss of ₹8.22 crore. The Board approved the un-audited standalone and consolidated results for the quarter and half year ended 30 September 2025 after Audit Committee review, along with the statutory auditors’ limited review report.

What changed in Sagar Cements' costs and profit?

Total expenses rose ₹93.54 crore or 16.7% to ₹652.71 crore from ₹559.17 crore in Q2 FY25. Cost of materials increased ₹12.42 crore or 14.2% to ₹100.04 crore, employee cost rose ₹8.50 crore or 27.7% to ₹39.21 crore, and other expenses increased ₹12.19 crore or 3.8% to ₹330.67 crore. Finance costs edged up ₹0.10 crore or 0.2% to ₹46.48 crore, while depreciation fell ₹1.90 crore or 3.3% to ₹55.70 crore.

Other income declined ₹0.50 crore or 10.3% to ₹4.34 crore from ₹4.84 crore. There was no exceptional item in the quarter. The tax line moved from ₹22.23 crore in Q2 FY25 to ₹2.34 crore in Q2 FY26, an improvement of ₹19.89 crore. Against the year-ago quarter, profit before tax improved by ₹32.70 crore to a loss of ₹46.51 crore, and the net loss narrowed by ₹12.81 crore to ₹44.17 crore.

Against Q1 FY26, cost of materials fell ₹16.12 crore or 13.9% to ₹100.04 crore and other expenses fell ₹100.71 crore or 23.3% to ₹330.67 crore. Employee cost rose ₹5.22 crore or 15.4%, depreciation rose ₹1.05 crore or 1.9% and finance costs fell ₹0.61 crore or 1.3%. Total expenses nevertheless increased ₹1.76 crore or 0.3% to ₹652.71 crore, while the tax line declined from ₹16.41 crore to ₹2.34 crore.

How did the first half of FY26 go?

In H1 FY26, Sagar Cements reported consolidated revenue of ₹1,272.52 crore, up ₹236.80 crore or 22.9% from ₹1,035.72 crore in H1 FY25. Total income rose ₹232.19 crore or 22.1% to ₹1,281.05 crore from ₹1,048.86 crore, while the EBITDA margin for the half-year was not reported.

Profit before tax improved by ₹104.15 crore to a loss of ₹22.61 crore from a loss of ₹126.76 crore in H1 FY25. The net loss narrowed by ₹52.50 crore to ₹36.68 crore from ₹89.18 crore, and basic EPS improved to -₹2.81 from -₹6.82.

What do the balance sheet and cash flow show?

Total assets rose to ₹4,396.13 crore at 30 September 2025 from ₹4,176.60 crore at 31 March 2025. Total equity fell to ₹1,757.88 crore from ₹1,794.33 crore, while borrowings rose to ₹1,609.50 crore from ₹1,445.80 crore. Cash and cash equivalents fell to ₹1.12 crore from ₹70.49 crore; inventories declined to ₹247.56 crore from ₹273.60 crore, and trade receivables rose to ₹280.77 crore from ₹204.17 crore.

Trade payables rose to ₹608.81 crore at 30 September 2025 from ₹578.30 crore at 31 March 2025. H1 FY26 operating cash flow was ₹84.70 crore, compared with ₹17.31 crore in H1 FY25. Investing cash flow was negative ₹252.47 crore against negative ₹121.76 crore, financing cash flow was ₹98.40 crore against negative ₹59.92 crore, and capital expenditure was ₹180.41 crore against ₹69.06 crore.

How has Sagar Cements done over the last 8 quarters?

Revenue rose year on year in each of the last two quarters, but the direction from the most recent quarter was lower. Q2 FY26 revenue of ₹601.86 crore was below the ₹670.66 crore reported in Q1 FY26, while EBITDA margin fell to 8.5% from 18.1%. The margin had reached its lowest point at 4.2% in Q2 FY25 before recovering in the following quarters.

Quarterly profit has been uneven across the reported period. It reached a net profit of ₹11.58 crore in Q4 FY24, then moved to a net loss of ₹73.05 crore in Q4 FY25 before reporting a net profit of ₹7.49 crore in Q1 FY26. In Q2 FY26, the company returned to a net loss of ₹44.17 crore. The EBITDA margin bottomed at 4.2% in Q2 FY25 and peaked at 18.1% in Q1 FY26.

What did Sagar Cements' management say?

Management said Q2 FY26 volume grew 17% year on year and maintained FY26 sales-volume guidance of approximately 6 million tonnes. The company expects demand to strengthen in the second half of FY26, supported by pent-up consumption and higher government spending, while pricing remained broadly stable with some seasonal softening. Management also said the FY26 EBITDA-per-tonne target of ₹600 was being maintained.

Joint Managing Director Sreekanth Reddy said: “The next year guidance, probably we would like to revise upward. As we come closer probably, there might be some upward revision for the next year.” He also said the company was keeping its annual EBITDA-per-tonne outlook unchanged, with underlying quarterly EBITDA per tonne close to ₹530 after excluding the inventory adjustment. Management raised FY26 capital expenditure guidance to approximately ₹450 crore from ₹360 crore and guided FY27 capital expenditure at ₹250–275 crore, including waste-heat recovery at Gudipadu.

Management said Andhra Cement was expected to break even at 50% utilisation and target EBITDA of ₹500–600 per tonne at 60% utilisation in FY27. The Vizag land sale was delayed by 3–6 months because of paperwork corrections at the collectorate, though management expected better realisation given data-centre activity involving Google and Adani. The rights issue for Andhra Cement was SEBI-cleared and valid until December 2025, while an offer for sale was under evaluation.

Reddy said: “We are very, very hopeful and very positive that demand is likely to be sustained in a similar kind of double-digit growth over the next couple of years, especially in Andhra.” Management identified pet-coke pricing, new South India capacity, post-monsoon pricing recovery and the Vizag land-sale delay as risks. On the earnings call, management also cited Andhra demand linked to data centres, the IOCL refinery and a capital-city project.

How did Sagar Cements shares react?

The results were announced after market on 23 October 2025. From the price when the filing appeared, the stock rose 2.9% after five minutes, then moved down 0.3% after 15 minutes and up 0.1% after 30 minutes. It closed the reaction day down 5.9% from the previous close. By the next day’s close, the stock was down 4.7% from its pre-results close, and by five days it was down 6.7%.

The Cement & Cement Products industry’s median move was down 0.6% on the reaction day, down 0.2% by the next day and down 1.0% by five days. Sagar Cements underperformed the industry median by 5.3 percentage points on the reaction day, 4.5 percentage points by the next day and 5.7 percentage points by five days. The Nifty Microcap 250 moved down 0.3%, up 0.1% and up 0.2% over the corresponding closes.

Earlier reaction-day moves were mixed: the stock fell 4.6% on 21 July 2025, rose 0.2% on 12 May 2025 and fell 4.2% on 24 January 2025. The preceding reaction-day moves were 3.2% on 23 October 2024, 1.3% on 18 July 2024 and 2.4% on 14 May 2024.

How did other Cement & Cement Products companies do?

Among 35 other Cement & Cement Products companies that had filed for the quarter, the median revenue growth was 16.5%. Twenty-seven peers grew slower than Sagar Cements, while eight grew faster than the company. Of 36 peers for which profit was compared, 29 reported higher profit.