Ramco Cements reported a disappointing Q3FY25, with EBITDA at Rs 2.8 billion, marking a 10% QoQ and 29% YoY decline, significantly missing CLSA’s estimates due to weaker pricing and higher costs. As a result, CLSA has cut its target price to Rs 795 from Rs 855, while maintaining an ‘Underperform’ rating.
Unlike its cement sector peers, Ramco saw volumes decline by 3% QoQ, despite showing a 9% YoY growth due to new capacity additions. The company attributed this to seasonal monsoon-related weakness. Meanwhile, EBITDA per tonne fell 8% QoQ to Rs 639, dragged down by rising raw material costs and weaker cement prices.
On a positive note, Ramco’s net debt reduction was supported by monetization of non-core assets, and the company remains on track to expand capacity to 30 MTPA by FY26, from the current 24 MTPA. However, given the near-term pressures on pricing and margins, CLSA remains cautious on Ramco’s outlook.
