Ambuja Cements

Ambuja Cements achieved a significant milestone by crossing 100 million tons (MT) of cement capacity within 30 months, becoming the ninth largest cement company globally. The company is aggressively pursuing organic growth, targeting 118 MTPA by the end of FY26 and 140 MTPA by FY28. Key projects include commissioning grinding units at Sankrail and Sindri in Q1 FY26, and clinker units at Bhatapara, Maratha, and Jodhpur by Q3/Q4 FY26, with 87% progress on Bhatapara and 88% on Sankrail.

For Q4 FY25, Ambuja Cements reported a revenue of INR 9,889 crores, an 11% YoY increase, and an EBITDA of INR 1,868 crores, translating to an EBITDA per ton of INR 1,001. The full FY25 saw a record annual revenue of INR 35,045 crores and an EBITDA of INR 5,971 crores (EBITDA per ton of INR 915). Operational costs for Q4 FY25 were INR 4,104 per ton, a reduction driven by better fuel management and green power. The company aims for an operational cost of INR 3,650 per ton and an EBITDA per ton of INR 1,500 by FY28, having already achieved INR 150-175 per ton in cost savings.

The company is making substantial investments in green energy and logistics optimization. 99 megawatts of wind power at Khavda were commissioned in Q4 FY25, with the full 1,000 megawatts of renewable energy expected to be commissioned by Q2 FY26. This, along with WHRS capacity targeting 30% of total capacity, is reducing fuel costs (kiln fuel cost reduced by 14%). Logistics costs declined by 2% due to footprint optimization and the deployment of 11 GPWI rakes and 26 BCFC rakes, with 8 BCFC rakes delivered in FY25.

Ambuja Cements is embracing Industry 4.0 technologies, including predictive analytics, AI, and ML, to enhance efficiency, streamline operations, and improve customer experience. The company has also undertaken a strategic leadership realignment, elevating Mr. Vinod Bahety to CEO and appointing Mr. Rakesh Tiwary as CFO. Over 1,000 campus graduates have been hired, and new leadership roles have been filled to drive agility and responsiveness to market demands, aiming to build a dynamic and forward-thinking organization.

The integration of recent acquisitions, including Sanghi, Penna, My Home, Asian Cement, and Orient Cement, is progressing well and unlocking synergies. The Orient acquisition involved an outflow of INR 5,500-5,600 crores. While Penna's clinker utilization is strong at 75-80%, Sanghi faced initial maintenance challenges, leading to 40-45% utilization in FY25. The company is also proactively providing for the impairment of older, unfeasible clinker assets like Bargarh, Chaibasa, and Wadi line 1, with INR 200 crores provisioned.

Management remains positive on the industry outlook, expecting cement consumption to grow by 8% in FY26, supported by increased construction activities, rural demand, and government spending. The long-term outlook projects industry supply to grow at a 6% CAGR and demand at 7-7.5% CAGR, leading to improved capacity utilization of 67-68% by 2030. While South markets were sluggish, Eastern and Northern regions were slightly subdued, but overall pricing trends are healthy.