The tax levy on limestone mined in the state has added considerable pressure on input costs, given that limestone is a key raw material in cement manufacturing. This additional financial burden impacted the company’s cost structure during the June 2025 quarter.
Despite this cost pressure, the company more than doubled its net profit to ₹86 crore, up from ₹35.5 crore in the same period last year.
The Government of Tamil Nadu, on February 20, 2025, passed a new legislation titled the Tamil Nadu Mineral Bearing Land Tax Act, 2024, which came into effect on April 4, 2025. Under this Act, the company is required to pay a tax of ₹160 per tonne of limestone mined in Tamil Nadu.
“The MBT levy of ₹160 per tonne of limestone, introduced by the Tamil Nadu government in April 2025, is currently unique to the state and translated into a ₹30 crore impact on the company’s Q1 variable costs. This pushed the raw material cost per tonne up by 7% year-on-year to ₹1,056 from ₹990, despite partial consumption from opening inventory,” said a company statement.
Even with these cost headwinds, the company managed to improve its profit before tax, which surged to ₹116 crore from ₹48 crore in Q1 FY25, while EBITDA rose 23% to ₹404 crore from ₹328 crore. The EBITDA margin improved to 19% from 16%, supported by better cement pricing. Blended EBITDA per tonne increased to ₹981 from ₹752.
However, the company’s cement sales volume declined by 7% to 4 million tonnes during the quarter, from 4.29 million tonnes in Q1 FY25. The drop was attributed to early monsoon rains in Kerala and unseasonal rains in eastern markets, where several infrastructure projects are nearing completion. Consequently, cement capacity utilisation slipped to 68%, from 77% a year ago. Additional capacity of 1.3 million tonnes per annum, added through debottlenecking after Q1 FY25, also weighed on the utilisation rate.
Net revenue came in slightly lower at ₹2,077 crore, compared to ₹2,097 crore a year earlier. On the other hand, the construction chemicals segment registered robust growth, with sales volume rising 79% to 1.2 lakh tonnes, up from 0.67 lakh tonnes.
Fuel and power costs per tonne of cement eased to ₹1,222 from ₹1,300, despite a 3% adverse impact due to rupee depreciation. The company reported a blended fuel cost of $126 per tonne (₹1.55 per Kcal) versus $137 (₹1.49 per Kcal) in the previous year. Green energy usage declined to 31% from 33% due to lower clinker production, although the cement-to-clinker ratio improved to 1.45x from 1.41x.
Finance costs declined to ₹105 crore from ₹113 crore, aided by lower borrowings and a 100-basis-point repo rate cut since February 2025. Depreciation increased to ₹183 crore from ₹167 crore due to the commissioning of new facilities in the previous year.
Ramco Cements said it continues to focus on strengthening its brand through application-specific product strategies.