Dalmia Bharat (DALBHARA IN) – Q2FY26 Result Update – Decent Q2; uphill task ahead – Accumulate
Published on 19 Oct 2025
Capex execution is progressing well, with trial runs underway at the 3.6mt clinker line in Umrangso and 52% of civil work completed at Belgaum IU. However, intense competition from larger players continues to limit DALBHARA’s volume growth potential. With no price hikes expected over the next couple of months and rising pet coke costs, sustaining margins in the near term could be challenging, though anticipated demand recovery in H2 should provide some cushion. We remain watchful of: (1) pricing trends in the South and East, (2) increase in pet coke costs, (3) execution progress of the upcoming capacities, and (4) volume traction amid heightened competitive intensity. We cut our FY27/28E EBITDA by 3% each due to loss of market share and incremental pricing pressure in key regions. At CMP, the stock is trading at 11x/10x EV of FY26/FY27E EBITDA. Maintain Accumulate with TP of Rs2,372 valuing at 11x EV of Sep’27E EBITDA.
