Welcome to Sanghi Industries – a cement company that somehow manages to be the second-largest single-location plant in India, but still bleeds cash faster than an IPL team at an auction. Gujarat is its adda, 85% of sales come from there, and the rest is basically side hustle. Current situation? Cement in bags, debt in trucks, losses in shiploads.
2. Introduction
Every cement company dreams of becoming Ultratech. Sanghi, on the other hand, dreams of breaking even.
On paper, it has everything – 3.3 MTPA clinker, captive port, captive power plant, even a desalination plant. Basically, it looks like Reliance Jamnagar refinery ka chhota cousin. But when you open the P&L, it feels like CID episode – dead body (profit) missing, and ACP Pradyuman shaking his head saying: “Daya, yeh company ke numbers dekh ke darwaza todna padega.”
FY23 was bad (-₹404 Cr loss), FY25 was worse (-₹498 Cr loss). Debt is now ₹2,500+ Cr, promoter pledge 14%, and they’re issuing preference shares like college canteen coupons.
But wait, plot twist – Ambuja Cements (Adani group) entered with a scheme of arrangement in Dec 2024. So maybe the rescue van is here. Or maybe it’s just another cement truck reversing.
3. Business Model – WTF Do They Even Do?
Okay, detective magnifying glass on:
Core Product – Cement. Mainly OPC (66%), PPC (33%), and a token PSC (1%).
Add-on Service – “Shakti Rath” – basically a mobile cement testing lab. Cute, but not exactly revenue material.
Markets – Gujarat is life, Maharashtra/Rajasthan are side gigs, exports vanished (from 6% FY22 to 0% FY23).
Power – 130MW captive thermal plant (because in India, “captive power” = burn coal, burn money).
Capex – Completed expansion in 2021 (clinker + grinding unit), but Surat expansion plan now parked like an abandoned JCB.
So yes, they make cement. But the more important business line seems to be financial engineering – issuing NCDs to Kotak Special Situations Fund (₹500 Cr), redeeming some with premium, raising preference shares like Diwali ladoos.
Question for you: If you were running a cement company and losing ₹400 Cr annually, would you invest in more kilns or just start a debt-restructuring consultancy?
4. Financials Overview
Metric
Latest Qtr (Jun ’25)
YoY Qtr (Jun ’24)
Prev Qtr (Mar ’25)
YoY %
QoQ %
Revenue
₹245 Cr
₹223 Cr
₹335 Cr
+10.0%
-26.9%
EBITDA
₹25 Cr
-₹3 Cr
₹36 Cr
NA
-30.6%
PAT
-₹75 Cr
-₹89 Cr
-₹117 Cr
+15.7%
+35.9%
EPS (₹)
-2.92
-3.44
-4.53
NA
NA
Commentary: Sales up YoY (cement demand revival), but PAT is still negative like my bank balance after Diwali shopping. QoQ, they reduced losses, but “less loss” ≠ “profit.” EPS is a solid negative ₹18.8 annualised. Which means P/E is… let’s say “philosophical.”
5. Valuation Discussion – Fair Value Range
Method 1: P/E
EPS = -18.8. Negative. Hence, P/E is like my neighbour’s WiFi password – not meaningful.
Method 2: EV/EBITDA
EV = ₹4,182 Cr
EBITDA (TTM) = ₹125 Cr approx.
EV/EBITDA = 33.5x Peers trade 15–25x. Fair value range (if Sanghi was a normal co.): ₹1,800–₹3,000
