Sagar Cements swings to ₹28 Cr consolidated Q1 loss on margin squeeze, Andhra drag

Sagar Cements slipped to a consolidated net loss of ₹28.10 Cr in Q1 FY27 (attributable to the parent -₹23.11 Cr, EPS -₹2.15), against a ₹7.49 Cr profit in the year-ago quarter, even as consolidated revenue edged up 5.3% YoY to ₹706.07 Cr. The sequential comparison with Q4 FY26's ₹100.05 Cr profit flatters the deterioration: that profit was manufactured by a ~₹117 Cr deferred-tax credit sitting on a pre-tax loss, so on an operating basis the group has been under water for two straight quarters.

The loss is a margin story. Consolidated operating margin compressed to ~10.3% from 18.1% a year ago, with EBITDA down roughly 40% YoY despite higher revenue, as power & fuel (₹240.24 Cr) and freight (₹137.72 Cr) costs outran the topline. Below EBITDA, finance costs of ₹52.23 Cr (up from ₹47.09 Cr) and depreciation of ₹59.16 Cr dragged PBT to -₹36.59 Cr. The standalone parent tells a milder story — revenue up 8.3% to ₹471.81 Cr and only a ₹2.89 Cr loss versus ₹11.44 Cr profit a year ago — which means the bulk of the consolidated red ink sits in the subsidiaries, chiefly Andhra Cements. Both numbers are public and diverge materially: standalone is near-breakeven, consolidated is a clear loss.

The stock went into the print at ₹184, up 2.9% over the past month of trading.

The print runs against the confident tone of the Q4 concall, where management guided to ~7 MT FY27 volumes and a step-up to nearly ₹600 EBITDA/tonne on an Andhra Cements turnaround — none of which is visible in Q1, where the subsidiary remains the drag and the near-term fuel-cost headwinds management had flagged clearly materialised. Corporate action continued through the quarter: the board approved merging Andhra Cements into the parent (appointed date April 1, 2026), the ACL stake was cut to 75% via an OFS to meet minimum public shareholding, and the company commissioned a 4.35 MW waste-heat recovery plant plus 0.5 MTPA capacity — cost and capacity moves that have yet to show up in the margin. No street consensus was available for this small-cap, and management offers no formal quarterly guidance beyond the FY27 volume/EBITDA framework.