📈 Tokyo Cement Posts Strong FY25/26 Revenue Amid Cost Pressures

Performance Overview • Q4 Turnover: Rose by 36% YoY to Rs. 17,623 Mn, up from Rs. 12,960 Mn. • Full Year Turnover: Reached Rs. 61,011 Mn, a 22% growth YoY. • Sales Volume: Grew by 28% for the fiscal year, outperforming the overall construction industry growth of 19%. Profitability & Margins • Q4 PAT: Declined to Rs. 577 Mn (vs Rs. 664 Mn last year). • Full Year PAT: Fell to Rs. 2,580 Mn (vs Rs. 3,459 Mn last year) as the company absorbed cost escalations to protect market share, alongside higher depreciation from capacity expansion and vessel acquisition. Industry Drivers & Constraints • Demand Triggers: National cement consumption grew 19% to 5.62 Mn MT, fueled by resumed government infrastructure, private construction projects, and post-Ditwah rebuilding. • Labor Issues: Shortages in both skilled and unskilled labor remained a critical constraint for the sector. Macroeconomic Environment • Currency & Costs: The Rupee depreciated by 6.0% in Q4, paired with a 38% fuel price hike that spiked distribution costs. • Construction PMI: Volatility was evident, hitting a peak of 75 in January before dipping to 57 in March. Outlook • Near-term earnings are expected to remain subdued due to rising input costs and adverse weather. However, the medium-term outlook is cautiously optimistic, backed by upcoming projects like the Central Expressway (Rambukkana-Galagedara section) and 2026 budget infrastructure plans.