SHREECEM Q2 FY25 earnings call.
A source-linked concall view: reported numbers, management language, guidance, commitments and risks that should carry forward.
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Revenue
₹4,054 Cr
verified against source
Revenue YoY
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reported change
EBITDA
Pending
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Actual signal trajectory
Where this quarter sits.
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What the record says.
Shree Cement reported a challenging Q2 FY25 with subdued demand across all regions, leading to a deliberate strategy shift toward value over volume. The company achieved INR 4,447/ton cement realization (flat QoQ), outperforming industry price declines, while volumes declined 7% YoY to approximately 70 lakh tons. Operational efficiency drove 8% cost reduction to INR 4,122/ton, supported by lower fuel costs (1.71 CV vs 2.05 last year). Premium product share surged to 15% from 9% in Q1. The company maintained the highest EBITDA per ton (INR 780) in the peer group. Capacity utilization dropped to 56% with new commissioning expected between April-June 2025. Green power now comprises 54.8% of total energy use. Management targets INR 4,000 crore annual CapEx for the next four years to reach 80 MTPA capacity by 2028. Cash EPS for H1 FY25 stands at 456 vs 478 in H1 FY24, demonstrating resilient cash generation despite industry headwinds. The primary risk is demand recovery being weaker than anticipated, which could pressure both volumes and the premium product strategy.
Colored figures show movement against the previous available record.
Guidance to track
- Management expects to grow volumes broadly in line with industry demand growth over the next couple of years, with occasional quarters slightly above or below.
- Ongoing expansion projects at Jaitaran, Kodla, Baloda Bazar, and Etah on track for commissioning between April and June 2025.
- The company plans to spend approximately INR 4,000 crore every year for the next four years to fund expansion toward 80 MTPA by 2028.
- The company remains committed to reaching over 80 million tons annual capacity by 2028, actively identifying growth opportunities to meet this target.
Risks flagged
- Management did not directly address the market share question, instead redirecting to their value-over-volume strategy.
- An analyst highlighted that credit days have increased from 20 days (March 2021) to 36 days (current), raising questions about working capital management. Management attributed this to lower demand quarter and promised to follow up.
- Analyst questioned whether strategy goalposts are changing every quarter (market share pursuit in Q1 vs premium focus in Q2). Management emphasized dynamic profit maximization approach rather than consistent volume strategy.
- When asked about the 3 million ton Bangalore grinding unit, management stated they are still awaiting regulatory clearances with no definitive timeline, suggesting potential delays beyond planned 80 MTPA roadmap.
Key quotes
- Please don't look at net profit of Shree. Look at cash profit of Shree. By doing such accelerated depreciation, I am at a faster rate changing the nature of my non-fungible fixed assets to fungible cash assets.
- Whichever sale mix really gives you the best result, you will move to that. So what is the strategy? The strategy is to maximize profits come what may.
- We have made strong progress with green power comprising about 54.8% of our total power use, which is the highest in the cement industry.
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