Star Cement held its earnings call on February 09, 2026, to discuss the Unaudited Financial Results for the third quarter and nine months ending December 31, 2025. Key highlights included significant YoY growth in revenue and EBITDA. Management detailed operational performance, noting clinker production up YoY and sales volumes outpacing the previous year. The company also addressed strategic expansion plans, including entering Rajasthan and Bihar, while maintaining a cautious approach to pricing and capacity utilization.
Operational Highlights for Q3 FY26
The management shared significant improvements in production and sales volumes for the quarter ending December 2025.
- Clinker Production: Produced 8.94 lakh tons, up from 6.42 lakh tons in the same quarter last year.
- Cement Production: Reached 12.57 lakh tons, compared to 10.82 lakh tons YoY.
- Sales Volume: Sold 12.31 lakh tons of cement and 0.65 lakh tons of clinker.
- Geographical Sales: Northeast sales stood at 9.36 lakh tons (up from 8.37 lakh tons YoY).
- Product Mix: Blend mix comprised 18% OPC and the rest PPC.
Financial Performance Summary
The financials showed strong year-over-year growth across key metrics.
For the Quarter (Q3):
- Total Revenue: Approximately ₹880 crores (vs. ₹719 crores YoY).
- EBITDA (excluding exceptional item of ₹5.52 Cr): Reached ₹207 crores (vs. ₹107 crores YoY).
- Per Ton EBITDA: Improved significantly to ₹1,600 (vs. ₹1,000 YoY).
For the Nine Months Ended December ’25:
- Total Revenue: Around ₹2,603 crores (vs. ₹2,111 crores YoY).
- EBITDA: Approximately ₹631 crores (vs. ₹321 crores YoY).
- Profit After Tax: Stood at ₹243 crores (vs. ₹46 crores YoY).
- Per Ton EBITDA: Increased to ₹1,677 (vs. ₹1,005 YoY).
Incentives, Realization, and Costs
Management provided details regarding subsidy income and operational costs.
- Incentive Income: Booked ₹33 crores this quarter, down from ₹43 crores YoY, attributed primarily to the reduction in GST from 28% to 18%.
- Realization: Realization saw a 2% increase, driven mainly by an approximate Rs. 20 price increase in the Northeast, balancing out neutral trends in Bihar/West Bengal.
- Freight Costs: The Q3 increase was noted as a one-off cost due to a strike in October restricting movement, necessitating the use of rakes.
- Premium Cement: Share of premium sales in trade grew from 12% to 17.1% YoY.
- AAC Block Revenue: Currently generating about ₹13 crores from the new unit, with potential to reach ₹90 to ₹100 crores at full utilization.
- Fuel Mix: Fuel comprised 70.8% FSA, 15% biomass, and 5% spot, with a per kcal cost of 1.2.
Future Expansion and Capex Strategy
The focus is shifting toward strategic market entry and capacity build-up across the North region.
- Rajasthan Entry: Plan involves a 3 million ton clinker plant and subsequent grinding units, aiming to apply for EC by September/October.
- Bihar Unit: A 2 million ton grinding unit is planned to utilize existing Northeast clinker capacities better.
- Umrangso Clinker Plant: EC applied for, with potential foundation work starting later in the year.
- Overall Capex: The plan for four major projects (Bihar grinding, Nimbol clinker/grinding, Haryana grinding, and Umrangso clinker) is estimated at approximately ₹4,800 crores.
- Financing: Management aims to keep the Debt to EBITDA ratio below 1.5X, planning a QIP if thresholds are approached.
- EBITDA Guidance: For the long term, Star Cement aims for a consolidated sustainable EBITDA in the ₹1,300 to ₹1,400 per ton range, though steady-state EBITDA in the North might settle around ₹1,000 initially due to new market entry and branding costs.
Coal Supply and Legacy Mines
Regarding coal supply risks from environmental crackdowns in Meghalaya, management confirmed their supply is largely independent.
- Coal Sourcing: Supply is primarily linked to FSA from Coal India and spot contracts, with no significant direct link to illegal mining operations in Meghalaya.
- Limestone for Nimbol: The Nimbol auction mine has an average premium of 57%, but the company is actively seeking legacy mines which could potentially lead to a 0% auction price for the initial 10 years.
Source: BSE
