Check Out Dalmia Bharat’s View of Q1 FY2025: Concall Analysis

Dalmia Bharat Limited is one of the leading manufacturers and sellers of cement. The company has the fourth-largest installed capacity in India. Dalmia Bharat released its results for the quarter ended July 24, 2024, and concluded its earnings call on July 19, 2024.

Management Views on Q1 FY2025 Financials

In line with expectations, the quarter was an election quarter. The company witnessed a moderation in cement demand across all markets in the country. Other factors, such as heat waves, water shortages, and floods in certain regions, further added to the slowdown. Based on all these, the company believes that the sector demand grew in the range of 2% to 4% on a year-over-year basis.

During the period, the company delivered a volume growth of 6.2% and an EBITDA of ₹901 per ton. Regarding its organic expansion, the company is currently at 46.6 million tons and will reach 49.5 million tons by the end of Financial Year 25.

The company’s revenues during the quarter were flattish at ₹3,621 crores on a Y-o-Y basis, while its volumes grew by 6.2%. The NSR has declined by a similar percentage, keeping the revenue

flattish. On a Q-o-Q basis, while prices for the sector have declined in the range of 2%-3%, the company’s NSR declined marginally by 0.3% in Q1 FY2025 because of its initiatives to improve brand mix, price positioning and rationalisation of discounts.

Looking Ahead

For FY25, the company expects the total incentive accruals and collections to be around ₹300 crores. The company is committed to becoming a Pan India player by 2031, having a cement capacity of 110-130 million tons. While the company had given an intermittent milestone of 75 million tons by FY27, given that Jaiprakash Associates has entered into the insolvency process, the company believes that it should now be able to achieve this milestone by Financial Year 28.

In the past months, the company signed multiple renewable power agreements under the Group Captive Arrangement, which will secure 127 MW of renewable power through solar and wind energy. The commissioning of these renewable power plants is expected to be in FY25 and FY26. The company expects to reach about 50% of the RE power share by the last quarter of FY25.

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