01 — At a Glance
The Cement Company That Bought The Land Before Prices Went Bonkers
- 52-Week High / Low₹1,214 / ₹788
- Q3 FY26 Revenue₹2,119 Cr
- Q3 FY26 PAT₹387 Cr
- Q3 FY26 EPS (Not Annualized)₹16.36
- Annualized EPS (Q3×4)₹65.44
- Book Value₹320
- Price to Book3.21x
- Dividend Yield0.20%
- Debt / Equity0.52x
- Sales Growth 3Y CAGR12.4%
The Opening Frame: Ramco Cements closed Q3 FY26 with ₹2,119 crore revenue (+6% YoY), ₹387 crore PAT including ₹506 crore gain on asset sales. Cement volumes grew 5% YoY to 44.33 lac tonnes. But a new ₹160/tonne mineral bearing land tax in Tamil Nadu sliced ₹47 crore from Q3 margins alone. Capacity is up to 24.44 MTPA, with 31.14 MTPA targeted by March 2027. The P/E of 129x is insane—because 2024 earnings crashed. The company is burning capex like a startup, selling off non-core assets like a PE firm in clearance, and building cement factories like they’re going out of style.
02 — Introduction
Welcome to The World’s Most Expensive Capex Project Masquerading As a Cement Company
Ramco Cements is the seventh-largest cement producer in India. That sentence tells you everything: it’s big enough to matter, obscure enough that nobody bothers analyzing it, and trapped in an industry where adding capacity is the only strategy left. Based in Tamil Nadu, it sells mostly in South India—Tamil Nadu, Andhra Pradesh, Karnataka, Kerala—and has a growing footprint in the East.
The company’s grand vision is to quadruple its capacity from 16 MTPA in FY2021 to 31 MTPA by March 2027. To do this, they’re spending roughly ₹1,100–₹1,200 crore per year in capex. They’re borrowing money at 7.1–7.2% interest to fund this expansion. They’re selling non-core assets (land, subsidiaries) to plug holes. And they’re branding themselves as a “precision in every layer” cement company while their margins are being shredded by a new land tax.
The 9MFY26 numbers tell the real story: revenue up 5%, EBITDA up 16%, but PAT up 42%—almost entirely because they sold ₹506 crore worth of non-core assets. Strip out the exceptional items, and it’s a ordinary, capital-intensive business fighting to keep margins stable while building factories in a recession-waiting-to-happen.
Let’s decode what’s actually happening under the “Ramco Supercrete” branding.
Q3 Concall Highlight: “The capex for FY26 is estimated at ₹1,100 crores.” Translation: they’re spending the entire annual profit on building factories that may or may not get used when the cement cycle inevitably cracks.
03 — Business Model: WTF Do They Actually Do?
Cement. Then More Cement. Then Construction Chemicals. Then Asset Sales.
Ramco makes cement. Specifically, they make 13 types of cement—OPC, PPC, composite cement, specialty cement for different applications. They grind, they mix, they package, they distribute through 9,700+ dealers and 24,000+ sub-dealers. It’s a classic commodity play with a regional moat. In South India, they have near-fortress-like distribution. In the East, they’re still a challenger.
Cement is straightforward: buy limestone from quarries (either own or lease), mine it, crush it, heat it to 1,450°C with fuel (coal, pet coke, alternative fuels), grind clinker with gypsum, add additives, package, and ship. Ramco has done this for 70+ years. They have captive power plants (193 MW thermal, 166 MW wind, 53 MW waste heat recovery). They control costs through vertical integration and operational excellence.
The problem: everyone else does this too. UltraTech, Grasim, Ambuja, Shree Cement, ACC—all bigger, all more efficient, all less leveraged. Ramco’s competitive edge is geographic. They’re the third-largest player in South India with ~20% regional market share. But nationally, they’re a minnow.
Construction chemicals is their moonshot. They’re pushing a brand called “Hard Worker” (2-year-old venture, already 69% revenue growth YoY). The target: ₹2,000 crore in construction chemicals revenue within 5 years. Currently at ~₹255 crore annualized. So they need to grow this segment 8x in five years. Doable? Maybe. Likely? Let’s see after two more years of concalls.
South Share81%Regional Fortress
East Share19%Challenger Zone
Capacity Add7 MTPAFY26-27 Target
Green Power47%Q3 FY26 Mix
The Real Business Model: Sell cement at whatever price the market will bear. Spend aggressively on capacity to grab share when prices are low. Sell non-core assets to fund capex. Hope the next cycle comes before your debt maturity schedule does. This is literally what’s happening.
💬 Cement industry roast question: Do you think a 129x P/E on a capital-intensive commodity company is a “buying opportunity” or “avoid at all costs”? Comment below.
04 — Financials Overview
Q3 FY26: The Numbers (Clean & Dirty)
Result type: Quarterly Results | Q3 FY26 EPS: ₹16.36 | Annualized EPS (Q3×4): ₹65.44 | FY25 Full Year EPS: ₹11.54
| Metric (₹ Cr) |
Q3 FY26
Dec 2025 |
Q3 FY25
Dec 2024 |
Q2 FY26
Sep 2025 |
YoY % |
QoQ % |
| Revenue | 2,119 | 1,988 | 2,242 | +6.6% | -5.5% |
| EBITDA | 298 | 291 | 394 | +2.4% | -24.4% |
| EBITDA Margin % | 14% | 15% | 18% | -100 bps | -400 bps |
| PAT (Excl. Exceptional) | 6.58 | 4.35 | N/A | +51.3% | — |
| PAT (Incl. Exceptional) | 387 | 325 | 100 | +19.1% | +287% |
| EPS (₹) | 16.36 | 13.76 | 3.14 | +18.9% | +421% |
The Exceptional Items Trap: Strip out the ₹506 crore profit on sale of non-core assets and the -₹27 crore impact of labour code 2025, and Q3 FY26 PAT is just ₹6.58 crore. Revenue grew 6.6% YoY. But standalone profit grew 51.3%. The difference? Asset sales. This is classic “sell your furniture to pay the rent” behavior. The market’s P/E of 129x is based on LTM earnings inflated by one-off gains. Real sustainable PAT is closer to ₹30–50 crore per quarter, not ₹387 crore.
05 — Valuation: What’s a Debt-Heavy Capex Machine Worth?
Three Methods to Figure Out Fair Value (Spoiler: It’s Messy)
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