Once upon a time, in the dusty cement plains of Guntur, a company named Andhra Cements Ltd (ACL) was clinically dead. Plants shut since 2020, auditors gone silent, creditors crying harder than retail investors in a penny stock. Then came Sagar Cements Ltd, doing a full-blown phoenix act in 2023 — infused ₹322 Cr, revived operations, and declared “Let there be clinker!”
Fast-forward to Q2 FY26:
Market Cap: ₹710 Cr
CMP: ₹76.3
3-Month Return: +9.36% (that’s optimism or short covering, we’ll never know)
Book Value: ₹8.27 (meaning: price is 9.2× book, a premium usually reserved for FMCG royalty, not a company with negative profits)
ROE: -68.4% — yes, you read that right, it’s losing money faster than cement sets.
Debt: ₹931 Cr, Debt/Equity 12.2×, because financial leverage is their favourite construction material.
PAT (Q2): -₹41.9 Cr on revenue ₹77.8 Cr.
This company’s story is like an Ekta Kapoor reboot — old, dramatic, resurrected, and still not profitable. Let’s find out why cement is the only solid thing here.
2. Introduction – The Resurrection of a Cement Zombie
Remember the good old days when every district had a cement company and every cement company had an excuse? Andhra Cements was one of them. Born in 1936, it survived wars, elections, and multiple promoters — but not the great debt avalanche of the 2010s.
By 2020, both its plants — Sri Durga (Dachepalli) and Visaka Cement Works — were shut. The Dachepalli unit gathered dust; the Visaka plant sat inside city limits where even trucks refused to visit.
Enter 2023, CIRP special. The NCLT gave it a lifeline via Sagar Cements Ltd, which acquired 95% stake and promised to pump cash, oxygen, and corporate governance. They even restarted the Dachepalli unit in April 2023.
Now it’s 2025. The preheater system is working overtime, clinker capacity expanded from 1.85 MTPA → 2.3 MTPA, grinding from 2.25 → 3 MTPA, and the company just announced a new 6-stage preheater commissioning on 23 Oct 2025 — the only “hot” thing about this company so far.
But profitability? Still under construction.
3. Business Model – WTF Do They Even Do?
You guessed it — they make cement. But not the kind that holds up skyscrapers of EBITDA.
Andhra Cements manufactures and sells cement and clinker under the Durga Cement and Visaka Cement brands (ironically, both names now refer to “past glory”).
Their operations revolve around:
Clinker production at Dachepalli.
Grinding and bagging operations.
Sales through dealers in Andhra Pradesh and Telangana.
Since the revival, management has focused on restoring plant utilisation, improving thermal efficiency, and leveraging parent Sagar Cements’ supply chain.
Sounds neat? Wait till you read the footnotes. Despite all that effort, FY25 margins were -3.4% OPM, and losses continue every quarter.
Essentially, this is a turnaround story still searching for the turn.
4. Financials Overview
Metric
Q2 FY26
Q2 FY25
Q1 FY26
YoY %
QoQ %
Revenue (₹ Cr)
77.8
55.0
100
+41.9 %
-22.2 %
EBITDA (₹ Cr)
-4
-10
7
+60 %
-157 %
PAT (₹ Cr)
-41.9
-35
-30
-20.2 %
-39.6 %
EPS (₹)
-4.55
-3.78
-3.21
-20 %
-41.7 %
Annualised EPS: -₹18.2 → P/E not meaningful (unless you value loss per share).
Commentary: Revenue grew YoY, but bottom line kept falling like sand from a leaky bag. The company’s EBITDA is a musical chair of negative numbers — one quarter better, the next back in red. For a cement maker, that’s like selling biryani without rice.
5. Valuation Discussion – Fair Value Range (Educational Purpose Only)
Let’s crunch this academically, because reality hurts:
EV/EBITDA: EV = ₹1,607 Cr; EBITDA ≈ -₹8 Cr → ratio = nonsense.
DCF (theoretically): Assume turnaround to ₹50 Cr EBITDA by FY28, WACC 12%, terminal growth 4%, we get intrinsic range ₹40 – ₹70 per share.
Hence, Educational Fair-Value Range: ₹40 – ₹70 per share. Not investment advice. This is for study, not brokerage.
6. What’s Cooking – News, Triggers, Drama
Oh, plenty of masala in this mix:
23 Oct 2025: Commissioned the 6-stage preheater, taking clinker to 2.30 MTPA, grinding to 3.00 MTPA. Expect “production ramp-up” press releases every quarter now.
Sep 2024: Rights issue of ₹180 Cr to part-fund expansion and restore public shareholding to 25%. (Because after Sagar’s 95% acquisition, the float was thinner than a dosa.)
Jul 2024: Announced a 6 MW solar plant at ₹19 Cr. Maybe they’re tired of paying the power bill.
Mar 2024: Approved massive related-party transactions worth ₹570 Cr, including ₹500 Cr with RV Consulting Services Pvt Ltd. Because why not mix some family cement?
May 2024: Credit rating IND BBB (-) from India Ratings. “BBB Negative” – basically the polite way of saying “Please pay on time.”
Question for readers: If your company spends ₹47,000 lakh on expansion while losing ₹40 Cr every quarter, is that optimism or just classic corporate cosplay?
7. Balance Sheet – The Great Cement Jenga
(₹ Cr)
Mar 2021
Mar 2022
Mar 2023
Mar 2024
Mar 2025
Sep 2025
Total Assets
940
871
917
1,080
1,144
1,329
Net Worth (Equity + Reserves)
-680
-916
355
297
144
76
Borrowings
963
970
525
675
757
931
Other Liabilities
656
817
36
107
243
322
Total Liabilities
940
871
917
1,080
1,144
1,329
(Validation Check: Net Worth + Borrowings + Other Liabilities ≈ Total Assets. Math is holding, barely.)
