ACC vs Shree Cement (2026): Costs, EBITDA/Tonne, Merger & Which Is Better?
This is partly a cement comparison and partly a corporate-action comparison
ACC versus Shree Cement cannot be analysed in 2026 as though both companies will necessarily remain independent listed cement businesses for years.
Shree Cement is pursuing its own organic growth strategy.
ACC is already a subsidiary of Ambuja Cements and is moving through a proposed amalgamation that would eventually replace ACC shares with Ambuja shares.
The merger ratio has already been fixed.
That means an ACC shareholder is increasingly exposed not only to ACC's kiln economics, volumes and margins, but also to Ambuja's share price and the probability and timing of merger completion.
Before comparing EBITDA, understand what happens to ACC if the merger completes
Ambuja Cements' board approved the amalgamation of ACC in December 2025.
For every 100 ACC shares, eligible shareholders are to receive 328 Ambuja Cements shares.
SEBI issued its no-objection certificate on June 4, 2026.
An application was filed with the NCLT on June 29.
ACC's Q1 FY2027 release stated that the transaction is expected to be completed during FY2027, subject to the required statutory and regulatory approvals.
The merger was not completed as of the August 25 Bull Run market snapshot used here.
The fixed exchange ratio changes how ACC's price should be interpreted
At the August 25 Bull Run prices, ACC traded at ₹1,305.90 and Ambuja at ₹413.10.
Multiplying ₹413.10 by 3.28 gives an indicative Ambuja-share value of approximately ₹1,354.97 for each ACC share under the fixed ratio.
That was roughly 3.8% above ACC's ₹1,305.90 market price.
This is only a point-in-time merger-spread calculation.
It is not a guaranteed return.
Ambuja's price can change, the transaction takes time and completion remains subject to approvals.
It does show why ACC's standalone P/E is no longer the only valuation metric that matters.
Now compare the cement plants: Shree produced far more operating profit from similar India volume
ACC sold 10.0 million tonnes in Q1 FY2027.
Shree Cement sold 10.23 million tonnes of cement in India and 10.49 million tonnes including clinker.
The tonnage is surprisingly similar.
Yet the reported operating profit generated per tonne was dramatically different.
ACC vs Shree Cement: Q1 FY2027 factory economics
| Metric | ACC | Shree Cement | Interpretation |
|---|---|---|---|
| Cement / consolidated sales volume | 10.0 MnT cement | 10.23 MnT India cement; 10.49 MnT India incl. clinker; ~11.45 MnT consolidated | India cement scale is close |
| Revenue from operations | ₹5,808 Cr | ₹6,233 Cr consolidated | Shree slightly larger |
| Revenue growth YoY | Down from ₹6,328 Cr | +18.0% | Shree |
| Operating EBITDA | ₹457 Cr | ~₹1,272 Cr consolidated operating EBITDA | Shree |
| Operating EBITDA margin | 7.9% | ~20.4% | Shree |
| Operational EBITDA per tonne | ₹458 | ~₹1,111 consolidated | Shree |
| PAT | ₹147 Cr | ~₹531 Cr consolidated | Shree |
| Trade mix | 81% | ~62% India | ACC |
| Premium products as % of trade | 44% | 23.3% | ACC |
| Green-power share | 31% | Renewable electricity around mid-60s % of electricity mix | Shree |
| Current market cap | ₹25,983 Cr | ₹97,066 Cr | Shree |
| P/E | 13.61x | 59.55x | ACC lower |
| P/B | 1.26x | 4.17x | ACC lower |
| ROCE, Bull Run | 10.90% | 10.61% | Close |
| ROE, Bull Run | 10.93% | 7.78% | ACC |
| Debt/equity | 0.00 | 0.07 | Both conservative |
| Bull Run Score | 47.1/100 | 36.0/100 | ACC |
Why is ACC's EBITDA per tonne so low?
ACC itself flags an important qualification: Q1 contained higher MSA volumes with parent Ambuja Cements.
That means the ₹458 per tonne metric should not be interpreted as a pure measure of how efficiently every ACC kiln operated relative to every Shree Cement kiln.
Transactions and operating arrangements inside the Adani Cement platform affect reported economics at individual legal entities.
This is another reason the planned merger makes strategic sense.
The legal entities are already becoming more operationally integrated than a normal competitor comparison implies.
Even with that caveat, ACC's margin needs improvement
ACC's operating EBITDA margin fell to 7.9% from 12.3% a year earlier.
Revenue fell.
Volume declined from 10.7 million tonnes to 10.0 million tonnes.
PAT fell from ₹376 crore to ₹147 crore.
Management described the quarter as resilient because trade mix, premiumisation and logistics indicators improved, but the reported income statement remains weak.
ACC's hidden positive is mix quality
Trade share increased five percentage points to 81%.
Premium products increased to 44% of trade sales from 41%.
Premium cement normally receives better pricing and builds stronger dealer economics than low-value bulk dispatches.
A higher trade mix also means more sales through retail and dealer channels rather than institutional non-trade contracts where pricing can be highly competitive.
Premiumisation is not cosmetic in cement
Cement looks like a commodity until two companies sell the same tonne at different net realisations.
Premium products can command a higher price through differentiated strength, setting characteristics, durability, sustainability features, branding or application-specific performance.
The economic value becomes visible through higher realisation and EBITDA per tonne.
ACC's 44% premium share of trade is therefore strategically valuable.
The challenge is that Q1's higher premium mix has not yet translated into industry-leading reported EBITDA per tonne.
ACC is also shrinking the distance travelled by each tonne
Primary lead fell from 290 km to 254 km year on year.
In cement, logistics can decide profitability because the product is heavy and relatively low value per kilogram.
A company can manufacture clinker efficiently and still lose the advantage by transporting cement too far.
ACC also increased direct dispatch to 52%.
Both measures support lower freight and handling costs over time.
Power cost moved in the right direction
ACC's power cost declined to approximately ₹5.6 per kWh from ₹6.1 a year earlier.
Green-power share increased from 26% to 31%.
Those improvements partly offset higher kiln-fuel cost, which increased from approximately ₹1.56 to ₹1.67 per thousand kcal.
The West Asia conflict disrupted energy markets across the cement sector, so ACC was not alone in facing fuel pressure.
Shree Cement's Q1 was also hit by West Asia, but through a different mechanism
Shree management described Q1 as an abnormal quarter.
The company historically uses petcoke extensively because of its cost and heat-value advantages.
Supply disruption forced a shift toward more expensive coal.
Management said petcoke usage dropped from roughly 54% to only 9%.
The company also struggled to obtain its normal gypsum mix.
The result was higher fuel and raw-material cost, weaker blending economics and a shift toward lower-margin non-trade volume.
Shree's trade mix actually deteriorated while ACC's improved
Shree's India trade mix fell to approximately 62% from 71%.
Its blended-cement ratio fell to around 60% from 70%.
Its clinker conversion factor dropped from approximately 1.58 to 1.50.
These are bad movements for unit economics.
Yet Shree still generated around ₹1,111 of consolidated operational EBITDA per tonne.
That resilience helps explain why the company has historically been associated with cement cost leadership.
Shree's premium-product share still reached a record level
Premium products reached 23.3% of trade volume from 17.7% a year earlier.
The percentage is below ACC's 44%, but Shree's premium mix increased substantially even during a quarter when its overall trade mix weakened.
Bangur's master-brand strategy is intended to make this premiumisation easier across a single national identity rather than multiple legacy brands.
The most important Shree question is whether ₹1,111 per tonne was the trough
Management believes Q1 fuel cost was unusually high and expects healthier profitability as supply chains normalise.
Consolidated EBITDA per tonne had been approximately ₹1,339 in the previous-year quarter.
Returning even part of that gap would create substantial profit upside because Q1 consolidated volume exceeded 11 million tonnes.
A ₹100-per-tonne change across 40 million annual tonnes is roughly ₹400 crore of annual operating EBITDA before considering taxes or other effects.
That is why apparently small changes in cement cost per tonne matter so much.
Shree also has an unusually strong cash buffer
Consolidated net cash increased to approximately ₹8,348 crore at June 2026.
Bull Run records debt/equity of only 0.07.
This gives Shree the ability to fund expansion, renewable-energy projects, RMC growth and new geographies without relying heavily on leverage.
Its FY2027 India capex guidance is approximately ₹1,500 crore.
ACC is effectively debt-free too
Bull Run records zero debt-to-equity for ACC.
ACC reported net worth of approximately ₹20,562 crore and cash and cash equivalents of ₹375 crore at Q1 end.
The balance sheet therefore is not the reason ACC's margin is weak.
The current challenge is operating economics and the accounting structure of an increasingly integrated cement group.
The merger is designed to attack exactly those structural inefficiencies
Ambuja says combining ACC and Orient Cement into one corporate platform can improve margins by at least ₹100 per tonne through synergies.
Potential benefits include:
- Clinker balancing across plants.
- Integrated logistics planning.
- Lower duplicate corporate costs.
- Better freight optimisation.
- Unified brand and sales spending.
- More efficient capital allocation.
- Common procurement and energy sourcing.
Those are difficult benefits for ACC to capture fully while continuing to report as a separate listed subsidiary.
ACC shareholders therefore face a different future from Shree shareholders
A Shree shareholder is underwriting Shree Cement's own future cement economics.
An ACC shareholder is increasingly underwriting a fixed conversion into Ambuja Cements.
If the merger completes, the relevant long-term business becomes the combined Ambuja platform rather than standalone ACC.
This distinction makes a ten-year ACC-versus-Shree comparison less meaningful than it would have been several years ago.
Shree's capacity strategy remains mostly organic
Shree currently reports approximately 69.3 MTPA of India cement capacity and around 73 MTPA including overseas operations.
The company has spent years expanding through its own projects rather than paying large acquisition premiums for existing cement assets.
Its longer-term objective remains to move beyond 80 MTPA.
The company is also expanding RMC and pursuing Northeast opportunities.
Shree's Q1 utilisation was only around 62%
North utilisation was approximately 66%, East 60% and South 57%.
That may appear weak, but the denominator has increased because Shree recently added capacity.
Unused capacity can become a growth asset if demand catches up without requiring immediate new capex.
It can also become a drag if local oversupply persists and pricing deteriorates.
ACC's expansion is happening inside the much larger Adani Cement plan
A 2.4 MTPA grinding unit at Salai Banwa entered trial run and a 1 MTPA Kalamboli expansion remains part of the expansion program.
But ACC's strategic capacity should increasingly be viewed with the parent platform rather than as a completely independent buildout.
Ambuja's consolidated platform already stands at 109 MTPA.
Valuation looks absurdly favourable to ACC until the merger is considered
ACC trades at only 13.6x trailing earnings versus Shree around 59.5x.
ACC also trades around 1.26x book versus Shree above 4x.
On a standard industrial-company screen, ACC looks dramatically cheaper.
But the market is no longer valuing ACC only on its future standalone earnings stream.
The fixed exchange ratio links its terminal listed value to Ambuja.
Shree's high P/E needs context too
Cement profits are cyclical, so P/E can become highest when earnings are temporarily depressed.
Shree's Q1 PAT fell about 18% despite volume growth.
Bull Run's five-year profit-growth field is approximately negative 5.3%.
A 59x trailing P/E therefore assumes a meaningful earnings normalisation or future capacity-led growth.
If fuel costs normalise, trade mix recovers and utilisation increases, trailing earnings can rise without a similar increase in the share price.
Current market performance shows both stocks have already de-rated
| Market Metric | ACC | Shree Cement |
|---|---|---|
| Price on 25 Aug 2026 | ₹1,305.90 | ₹24,440 |
| 1-month return | -2.61% | -10.30% |
| 3-month return | -8.46% | -3.78% |
| 6-month return | -19.04% | -8.62% |
| 1-year return | -27.76% | -18.57% |
| 52-week high | ₹1,987 | ₹30,750 |
| 52-week low | ₹1,251.70 | ₹22,550 |
| RSI (14) | 30.99 | 23.68 |
Both stocks were trading near the lower portions of their 52-week ranges.
Shree's RSI below 25 indicates particularly weak short-term momentum.
ACC was also close to its 52-week low.
Technical weakness does not resolve the fundamental difference between a merger-linked stock and an independent cement operator.
What actually determines the outcome from here?
ACC-specific variables
- Completion of the Ambuja merger.
- Ambuja share-price movement before effective date.
- Realisation of at least ₹100/tonne merger synergies.
- Improvement in reported EBITDA per tonne.
- Continued premium-product growth.
- Lower logistics lead and energy cost.
Shree-specific variables
- Normalisation of petcoke and gypsum availability.
- Recovery of trade mix toward historical levels.
- Recovery of clinker conversion and blending.
- Capacity utilisation of recently added plants.
- Premium-products mix above 20%.
- Maintaining high net cash while expanding.
ACC vs Shree Cement: there are really two verdicts
If the question is “which company currently has the stronger standalone cement economics?”, Shree Cement wins.
It generated more than twice ACC's operational EBITDA per tonne in Q1 despite severe fuel disruption.
It has a huge net-cash position and a long record of cost-focused organic expansion.
If the question is “which stock has the lower conventional valuation and a corporate-action catalyst?”, ACC wins.
Its P/E and P/B are much lower, and the fixed Ambuja exchange ratio creates a distinct merger-value framework.
ACC vs Shree Cement FAQs
Which sold more cement in Q1 FY2027?
ACC sold 10.0 million tonnes. Shree sold 10.23 million tonnes of cement in India, 10.49 million tonnes including clinker, and approximately 11.45 million tonnes on a consolidated basis including overseas operations.
Which had higher EBITDA per tonne?
Shree Cement at approximately ₹1,111 of consolidated operational EBITDA per tonne versus ACC at ₹458.
Why is ACC's EBITDA per tonne so low?
ACC's release specifically notes higher MSA volumes with parent Ambuja, which affect reported company-level economics. Its operating margin also declined materially year on year.
What is the ACC-Ambuja merger ratio?
328 Ambuja Cements shares for every 100 ACC shares, subject to the merger becoming effective.
Has the ACC merger already completed?
No. ACC stated in its Q1 FY2027 release that the transaction remained subject to approvals and was expected to complete during FY2027.
Which is cheaper on P/E?
ACC by a wide margin on the August 25 Bull Run snapshot, though its pending merger reduces the usefulness of standalone P/E.
Which has the stronger balance sheet?
Both are conservative. ACC is effectively debt-free, while Shree had approximately ₹8,348 crore of consolidated net cash.
Which has the stronger premium-product mix?
ACC, where premium products represented 44% of trade sales versus Shree at 23.3%.
Research sources
Disclaimer
This article is educational and informational only. ACC is subject to a proposed amalgamation into Ambuja Cements at a fixed exchange ratio of 328 Ambuja shares for every 100 ACC shares. The illustrative merger-value calculation uses Bull Run's August 25, 2026 ACC and Ambuja prices and does not represent a guaranteed return because Ambuja's market price and transaction conditions can change. ACC and Shree Cement's reported EBITDA-per-tonne figures are also affected by different operating structures, consolidation scopes and ACC's MSA volumes with Ambuja. Cement companies should be evaluated using volume, realisation, EBITDA per tonne, fuel and power cost, freight, trade mix, premiumisation, capacity utilisation, balance-sheet strength and replacement economics rather than P/E alone. Nothing here recommends buying, selling or holding ACC, Shree Cement, Ambuja Cements or any other security. Bull Run is not a SEBI-registered Research Analyst or Investment Adviser.