Stock to Buy: Does Dalmia Bharat’s Q4 performance indicate a strong opportunity for investors?

Synopsis: Dalmia Bharat reported 3.7% YoY revenue growth in Q4, but net profit fell 10% YoY despite strong QoQ recovery. Brokerages are mixed: Goldman Sachs Neutral and Morgan Stanley Underweight, while Citi, HSBC, and CLSA remain positive.

The shares of a Mid-Cap company specialising in manufacturing and selling cement, holding a position as one of India’s largest cement manufacturers by capacity, are in focus following their Q4 results and the global brokerages’ views on results and operations.

With a market capitalization of Rs. 36,558.48 crores in the day’s trade, the shares of Dalmia Bharat Ltd rose upto 2.9 percent, making a high of Rs. 1,980.00 per share compared to its previous closing price of Rs. 1,923.80 per share.

What Happened

Dalmia Bharat Ltd, engaged in manufacturing and selling cement, holds a position as one of India’s largest cement manufacturers by capacity is in focus following their Q4 results and the global brokerages’ views as follows

Its Revenue from operations rose by 3.7 percent YoY from Rs. 4,091 Crores in Q4FY25 to Rs. 4,245 Crores in Q4FY26, and it rose by 21 percent QoQ from Rs. 3,506 Crores in Q3FY26 to Rs. 4,245 Crores in Q4FY26.

Its Net Profit YoY declined by 10.2 percent from Rs. 439 Crores in Q4FY25 to Rs. 394 Crores in Q4FY26, and on a QoQ basis, it rose by 207.8 percent from Rs. 128 Crores in Q3FY26 to Rs. 394 Crores in Q4FY26. 

The earnings per share (EPS) for the quarterly period stood at Rs. 20.63, compared to Rs. 23.19 in the previous year’s quarter. The company has recommended a final dividend of ₹5 per equity share of face value Rs. 2 each (i.e., 250%) for the financial year ended March 31, 2026. 

Brokerage Viewpoints

Goldman Sachs has maintained a Neutral rating on Dalmia Bharat with a target price of Rs. 2,090. The brokerage noted that recent weakness in volumes has been driven by kiln shutdowns, which temporarily impacted production and sales.

Despite the near-term volume pressure, profitability is expected to remain supported by strong cost-control measures. Goldman Sachs also believes that Dalmia Bharat’s near-term growth could potentially outperform the broader industry, even though the overall outlook remains balanced rather than strongly bullish.

Morgan Stanley has maintained an Underweight rating on Dalmia Bharat with a target price of Rs. 2,015. It highlighted a small earnings beat, but noted that key overhangs on the stock continue to persist, limiting re-rating potential in the near term.

The brokerage also flagged that geopolitical developments in West Asia could lead to an estimated cost inflation of ₹125–150 per tonne in Q1, adding pressure on margins. It added that clearer visibility on the company’s capacity expansion roadmap remains awaited, which will be important for assessing medium-term growth prospects.

Citi has maintained a Buy rating on Dalmia Bharat but has cut its target price to Rs. 2,450. The brokerage noted that while costs have remained relatively resilient, volumes were muted in Q4, reflecting near-term demand softness.

On the outlook, Citi expects capacity additions of ~5% in South and West India and ~7% in East and Central regions. It believes medium-term pricing pressure is likely to remain limited, with ongoing cost efficiencies expected to support returns and help sustain profitability despite cyclical volume fluctuations.

HSBC has maintained a Buy rating on Dalmia Bharat with a target price of Rs. 2,490. It highlighted that stronger cost control helped the company deliver a profit beat in Q4, even though volumes were lower during the period.

The brokerage also noted that April price hikes are expected to offset Q1 cost inflation of around ₹125–150 per tonne. It views management’s emphasis on profitable growth, higher capacity utilisation, and improved RoCE as positive. HSBC further pointed out that the valuation at 11.6x EV/EBITDA and the company’s strong regional presence in South and East India are key supporting factors for the stock.

CLSA has maintained an Outperform rating on Dalmia Bharat with a target price of Rs. 2,240. It noted a mixed quarterly performance, where EBITDA came in at Rs. 9 billion, up 14% YoY and slightly ahead of consensus expectations, supported mainly by lower input costs.

However, volume growth remained relatively weak at 4%, underperforming the industry growth of 6%–7%. While management remains confident of outperforming the industry over FY27–28, driven by demand recovery and operational normalisation, CLSA flagged near-term margin pressure. Rising costs in petcoke, packaging, and logistics, estimated at Rs. 125–150 per tonne, could weigh on profitability, though April price hikes may help partially offset this inflation.

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