Keshav Cement: Green Growth and Debt Reduction

  • FY26 Expected EBITDA: INR 55-60 crores (revised from INR 70-75 crores)
  • FY26 Expected EBITDA Margin: 25-30%
  • FY27 Expected EBITDA: Over INR 100 crores (at 65-70% cement capacity utilization)
  • Cement Capacity Utilization Target (FY26): 45%, rising to 55-60% (FY27) and 70% (FY28)
  • Solar Power Capacity: Current 40 MW, future expansion to 70 MW considered.
  • Debt Repayment (FY26): INR 25.8 crores (highest liability year)
  • Debt Repayment (FY27): INR 20-21 crores
  • New Cement Plant Stabilization: Expected by end of Q2 FY26.
  • RMC Plant: Delayed to Q3 FY26, pending cement plant stabilization.

Shri Keshav Cements & Infra Ltd. reported a significant 32.53% year-on-year income growth for Q1 FY'26, reaching INR41.4 crores. This robust performance, driven by new kiln capacity and solar contributions, sets a positive tone for the company's ambitious forward-looking guidance, emphasizing strategic growth, improved profitability, and disciplined debt management.

Cementing Growth: Capacity and Profit Targets

Shri Keshav Cements & Infra Ltd. has successfully commissioned a new kiln, increasing its cement capacity from 0.36 million tons to 1 million tons. For Q1 FY'26, the company reported a total income growth of 32.53% year-on-year to INR41.4 crores, with EBITDA rising to INR10.41 crores, reflecting a 25.5% margin. The new kiln contributed to an improved EBITDA per metric ton of INR365, the highest since inception, up from less than INR100 last year. The management aims to stabilize the new plant and reach approximately 45% capacity utilization in FY'26, gradually increasing to 55-60% in FY'27 and 70% in the following year. While the EBITDA guidance for FY'26 has been revised to INR55-60 crores from an earlier INR70-75 crores due to initial ramp-up challenges, the company projects over INR100 crores in EBITDA by FY'27 with 65-70% capacity utilization. The company stated,

"EBITDA per ton for this quarter, we realized around INR365 per metric ton, which is the highest since inception so far."

Powering Ahead: Solar, Debt, and Future Ventures

The company's solar operations continue to be a significant contributor to profitability. With a current capacity of 40 megawatts, solar power accounted for INR7.8 crores of EBITDA in Q1 FY'26, surpassing cement's contribution of INR3.2 crores. The management is considering expanding solar capacity by another 30 megawatts in the future, post-cement plant stabilization. Financially, Shri Keshav Cements & Infra Ltd. is focused on debt reduction. The company expects FY'26 to have the highest repayment liability at INR25.8 crores, which is projected to decrease to INR20-21 crores in FY'27 and further to less than INR15 crores from FY'28 onwards. This disciplined approach is expected to lead to approximately INR70 crores of debt repayment over the next three years. The company is also evaluating a Ready Mix Concrete (RMC) plant venture, with land already acquired, planning to initiate the project after the cement plant achieves full stabilization, expected by the end of Q2 or early Q3 FY'26. This vertical integration is anticipated to yield better margins by utilizing internal cement production.

Shri Keshav Cements & Infra Ltd. is poised for significant growth, driven by enhanced cement capacity utilization and strong solar contributions. Despite initial ramp-up challenges, the company anticipates reaching higher EBITDA margins and effectively managing debt. The strategic focus on operational efficiency, market penetration, and potential diversification into RMC positions Keshav Cement for sustained financial strength and market leadership in the coming years.

Read more