Ramco Cements tanks 7% post Q1 results; should you buy, hold or sell?

Shares of Ramco Cements Ltd fell 7 per cent in Friday’s trade after the cement maker reported a year-on-year (YoY) de-growth in volumes for the June quarter, even as its net profit climbed 138.8 per cent during the same period. 

The stock declined 7.1 per cent to hit a low of Rs 1,055.45 on BSE over its previous close of Rs 1,136.15. At 1:23 pm, the scrip was trading 6.54 per cent lower at Rs 1,061.90. It is now down nearly 11 per cent from its 52-week high of Rs 1,206.60.

Ramco Cements posted a PAT of Rs 86 crore for Q1FY26 against Rs 36 crore in the same quarter last year. Emkay Global Financial Services said Ramco Cements' reported standalone Ebitda was in in line with its estimate. Early monsoon (south) and completion of key infrastructure projects (east) impacted demand in Ramco's operating areas, resulting in cement volume falling by 7 per cent YoY, it said. 

"Aided by the robust price hikes in south India in Apr/May’2025, TRCL delivered 11 per cent QoQ realization growth, which more than compensated for the negative volume growth.”

Emkay added that operating costs were flat YoY and up about 4 per cent QoQ, with Ebitda per tonne at Rs 965 versus Rs 735 YoY and Rs 610 QoQ. “Given the robust realization growth performance and limited price correction despite early monsoon in Q2FY26TD, we marginally increase our FY26 Ebitda estimates by 3 per cent, while broadly maintaining the FY27 estimates. We maintain ‘ADD’ with a revised target price of Rs 1,150 (earlier Rs 1,090),” it said.

ICICI Securities said, “Ramco Cements' Q1FY26 Ebitda/tonne surged 59 per cent QoQ to Rs 966 (up 32 per cent YoY) driven by sharp price hikes in South India even as volumes slipped 6 per cent YoY. While the Ebitda missed our forecast by 11 per cent, the underlying buoyancy in cement prices in Q2FY26 so far helps in keeping our FY26E Ebitda largely unchanged.” The brokerage raised its FY27E Ebitda estimate by about 5 per cent but maintained a ‘HOLD’ rating, with a revised target price of Rs 1,088 (vs Rs 1,031 earlier).

Motilal Oswal Financial Services (MOFSL) said, “Operating performance was below our estimates due to lower volume, as realization and opex/t were in line. The company has shown improvement in profitability, led by a sharp price hike in its core markets (south and east). Our channel check suggests a price correction in the south region during Jun-Jul’25; however, current prices are still higher by Rs 25-35/bag vs Mar’25.”

MOFSL expects revenue and Ebitda to grow at a CAGR of 9 per cent and 24 per cent, respectively, over FY25–28, with PAT rising at a CAGR of 108 per cent on a low base. It values the stock at 13x Jun’27E EV/Ebitda, arriving at a target price of Rs 1,050, and reiterated its ‘Neutral’ stance.