Dalmia BharatLtd Q1 FY27 Earnings Call — Analysis (NSE: DALBHARAT)

Dalmia Bharat delivers 9% YoY volume growth and ₹1,055/t EBITDA despite cost headwinds; Jaypee acquisition integrated in 50 days, capacity on track to 67 Mt by Q3FY28.

28 Jul 2026 · Analysis by Alpha Inflection

The take

Q1FY27 Revenue from operations ₹3,890 Cr ( +7% YoY ) . New guidance — Q3FY28 total cement capacity ~67 million tons . New story: Jaypee acquisition and integration .

Results

Revenue up 7% YoY to ₹3,890 Cr; volumes +9% YoY; EBITDA/ton improved 3% QoQ to ₹1,055 but absolute EBITDA declined 11% QoQ to ₹805 Cr due to elevated input costs.

Financial highlights

Guidance

FY27 capex guidance maintained at ₹3,200–3,400 Cr (excl. acquisition cost); Belgaum plant to commence commercial production within 6 months; Jaypee assets to begin contributing meaningfully from Q3FY27.

What management committed to

• Indian cement demand will grow at a healthy rate of 7% in FY27. — 7%, FY27
• Our cement capacity will reach about 67 million tons by Q3FY28, including [Jaypee acquisition] and ongoing [expansion projects at Belgaum, Kadapa, Pune]. — ~67 million tons, Q3FY28
• Depreciation will increase by ₹100 Cr in FY27 over FY26, driven by commissioning of [acquired Jaypee plants] and [Belgaum capacity]. — ₹100 Cr increase, FY27
• Depreciation will increase by a further ₹100-150 Cr in FY28, with commissioning of [Kadapa and Pune projects]. — ₹100-150 Cr increase, FY28
• Final exceptional item for Jaypee acquisition (stamp duty, etc.) will be lower than the provisional ₹182 Cr booked in Q1. — less than ₹182 Cr, Q2FY27
• Jaypee assets will begin contributing meaningfully to volumes from Q3FY27. — meaningfully, Q3FY27
• Belgaum expansion will commence commercial production in the next 6 months (by January 2027). — within 6 months, Q3FY27
• FY27 capex (excluding acquisition cost) will be in the range of ₹3,200-3,400 Cr. — ₹3,200-3,400 Cr, FY27
• Of the FY27 capex, approximately ₹2,200 Cr will be for growth projects, with the remainder for maintenance, Jaypee catch-up capex, and other ROI projects. — ~₹2,200 Cr for projects, FY27
• Incentive accrual will remain in the range of ₹45-50 Cr per quarter for the next couple of years. — ₹45-50 Cr per quarter, FY27-FY28
• Share of renewable energy in power consumption will increase during FY27 from the current 48%. — increase from 48%, FY27
• Input costs (excl. operating leverage) may increase by ₹70-80 per ton in Q2FY27 vs Q1FY27, subject to geopolitical volatility. — ₹70-80/ton increase, Q2FY27

Key themes

Acquisition integration and capacity expansion

How the narrative shifted

• Input cost volatility from West Asia conflict: Management highlights persistent cost headwinds from fuel and packing materials due to geopolitical tensions, but emphasizes proactive mitigation through inventory planning and fuel mix optimization.
• Jaypee acquisition and integration: Jaypee acquisition seen as a strategic fit for pan-India presence, with rapid operational start-up and confidence in ramping up volumes and profitability.
• Premiumization driving realizations: Share of premium products at 25% and launch of Weather365 underpins pricing power and revenue quality improvement.
• Capacity expansion pipeline to 67 Mt: Organic and inorganic capacity additions on track; Belgaum ahead of schedule, Kadapa and Pune progressing, target 67 Mt by Q3FY28 with more announcements later.
• Capital allocation discipline: Management stresses balance-sheet health, leverage below 2x, and willingness to calibrate expansion speed based on macro; no intent to over-leverage.
• Resilient cement demand: India growth projection at 6.6%, government capex push, and strong GST collections support 7% industry demand growth, despite election-related temporary slowdown.

Operational commentary

• Completed acquisition of Jaypee Cement assets (5.2 Mt cement, 3.3 Mt clinker) in Central India on 29 May 2026; integration underway
• Chunar grinding unit restarted operations, Rewa clinker trial production begun within 50 days of acquisition close
• Belgaum expansion progressing ahead of schedule; commercial production expected in next 6 months
• Kadapa and Pune greenfield projects: site excavation started, contractors mobilized for civil and mechanical works
• Launched Weather365 premium-plus cement product; premium product share reached 25% of portfolio
• Total cement capacity trajectory: ~67 Mt expected by Q3FY28 (including Jaypee and ongoing expansions)
• Additional projects under evaluation; announcements expected in due course
• Renewable energy share at 48%, more RE capacities to be added during FY27
• Incentive accrual expected at ₹45-50 Cr per quarter for next couple of years

Analyst Q&A

• Q. What is the approximate land cost required to access the full 100 MnT limestone reserve at the Jaypee asset?

  Management stated that existing lands are sufficient for initial years, adjacent reserves are available, and land procurement is an ongoing process; a specific cost figure cannot be provided now.

• Q. Why was the exceptional expense of ₹177-182 Cr not capitalized as part of the acquisition?

  Yatin Malhotra explained it is a provisional conservative number and final actuals may be lower; clarity expected by next quarter after registration is completed.

• Q. How much volume was sold into the central markets from East during FY26 to support Jaypee ramp-up?

  Management confirmed active network and brand presence in the central market, but declined to give exact volume numbers.

• Q. What will it take for the East India cement price gap to narrow?

  Management stated they have no specific answer and that market dynamics will determine pricing; they are hopeful good sense will prevail.

• Q. What utilization and EBITDA per ton assumptions were used in the internal IRR calculation for Jaypee?

  Management indicated the region is promising and that, in 6-8 quarters, EBITDA/ton should reach Dalmia's normal average, but did not share specific IRR inputs.

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