Dalmia Bharat shares declined more than 7% to hit their 52-week low in intraday trade on the BSE on Tuesday, 27 October, a day after the company announced its September quarter (Q2FY27) results. Dalmia Bharat share price opened at ₹ 1,542.65 against its previous close of ₹1,628.80 and dropped 7.4% to hit a 52-week low of ₹1,509.
Dalmia Bharat Q2 results
In an exchange filing on 26 October, Dalmia Bharat announced that its revenue from operations for the September quarter rose 4% year-on-year (YoY) to ₹3,563 crore, while sales volume increased by 3% YoY to 7.1 million tonnes.
The company reported a loss of ₹205 crore for Q2FY26 compared to a profit of ₹239 crore in the same quarter last year. EBITDA declined 29% YoY, and EBITDA/T dropped 31% YoY.
“We achieved 4% YoY revenue growth during the quarter on the back of volume growth and better realisation. Demand challenges in a few of our key markets, along with macroeconomic cost headwinds, impacted EBITDA for the quarter,” said Yatin Malhotra, Chief Financial Officer, Dalmia Bharat.
“While the operating environment continues to remain challenging, we are hopeful that positive momentum on cement prices and our consistent focus on cost optimisation will help mitigate cost pressures,” he added.
Should investors buy, sell, or hold Dalmia Bharat shares?
Brokerage firms appear cautious about the stock, and some of them have reduced their target prices for the stock after the company’s Q2 results.
Choice Equity Broking has a “buy” call on the stock with a reduced target price of ₹2,180 from ₹2,405 earlier.
“We retain our ‘buy’ rating but revise our target price to ₹2,180 from ₹2,405, reflecting our projection of a slower EBITDA recovery amid persistent fuel-cost inflation and incremental dilution from the Central India ramp-up.
“We project elevated fuel and raw material costs to continue weighing on profitability in the second half of FY27. We expect the acquired assets to remain a drag on consolidated profitability as operations transition towards optimal utilisation,” said Choice.
Choice projects Dalmia Bharat to deliver an EBITDA CAGR of nearly 7.9% over FY26–29E, driven by volume growth of 4%, 6%, 8% and realisation growth of 3.5%, 1.5%, 1% over FY27E–FY29E, respectively.
Systematix Shares and Stocks (India) has a “hold” call on the stock with a reduced target price of ₹1,772 from ₹2,000 earlier, citing that the company has underperformed vs its peers during the quarter, marred by adverse geographical mix, lower market share and higher cost in the Central region.
Systematix has cut its EBITDA and PAT estimates by 19% and 29%, respectively, for FY27E and 11% and 12%, respectively, for FY28E.
“A ₹15 per bag increase in prices in the east and south would offset the incremental cost. We forecast just 8% and 6% revenue and EBITDA CAGR, respectively, during FY26-FY28E,” said Systematix.
On the other hand, ICICI Securities has downgraded the stock to a “hold” from an “add” earlier, reducing the target price to ₹1,620 from ₹2,130 earlier.
“In light of our concern related to industry demand growth, the change of Dalmia Bharat’s sales head may pose challenges to our volume growth assumption. The underlying surge in fuel cost may impact margins in the backdrop of near-term weakness in profitability for the recently acquired JP Associates cement capacity. Factoring in these risks, we chop our FY27E and FY28E EBITDA by 15% and 19%, respectively,” said ICICI Securities.
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