Shri Keshav

Shri Keshav Cements delivered robust financial results for Q3 and 9 Months FY26. For the nine-month period, total income surged by 35.81% year-on-year to INR 116.31 crores. EBITDA saw an even stronger growth of 66.85% to INR 29.28 crores, with the EBITDA margin expanding by 454 basis points to 25.68%. The company also turned profitable with a PAT of INR 3.23 crores, compared to a loss in the previous year, and reported an EPS of INR 1.85. Q3 FY26 alone saw total income grow by 33.22% to INR 38.69 crores and EBITDA by 63.1% to INR 10.5 crores, with a margin of 27.68%.

The company's operational progress is marked by the stabilization of its new kiln and a focus on improving capacity utilization. Integrated solar operations, with 25 MW utilized for captive consumption and 15 MW sold, provide a significant structural cost advantage, contributing INR 25-26 crores in annual operating cost savings. This enables the company to remain competitive and maintain healthy operating margins. The clinker to cement ratio is expected to improve from 1.6-1.8 tons to 1.9-2 tons of cement per ton of clinker in the coming quarter, further enhancing efficiency.

Despite the Southern market experiencing negative growth and aggressive pricing strategies from larger players, Shri Keshav Cements achieved a 32% year-on-year volume growth. This was driven by aggressive marketing, new product additions like GGBS (granulated ground-based slag), and expansion into new markets. The company is leveraging its location on the Karnataka-Maharashtra border to penetrate Western markets like Coastal and Southern Maharashtra, which were previously unaddressed, thereby diversifying its market presence and reducing reliance on the competitive Southern region.

The company has made significant strides in strengthening its capital structure. Term debt has been reduced by 15%, from INR 188 crores to INR 159 crores. The repayment obligation for the next financial year is also set to reduce by 16.4% due to the closure of three term loans in FY26. The FY26 debt obligation is around INR 29 crores, with INR 26-27 crores already repaid. Management aims to further impair debt ahead of schedule once capacity utilization reaches 50%+, indicating a strong focus on financial prudence.

Shri Keshav Cements is optimistic about its future growth trajectory. The company expects to achieve around 40% capacity utilization by the end of FY26, targeting 45-55% in FY27. If market conditions improve, utilization could effortlessly reach 60%. At 60% utilization, EBITDA is projected to grow almost twofold, potentially reaching INR 90-100 crores, compared to the INR 40-45 crores expected for FY26 at 30-32% utilization. The company also plans to explore the Ready Mix Concrete (RMC) segment, having already purchased land for a project in Belgaum.