Shree Cements Ltd. share price target

In a recent media interaction, Shree Cement’s management stated that cement demand was slightly subdued in May due to a heatwave and geopolitical uncertainty (IndiaPakistan tensions) in the North.

Shree Cement’s (SRCM) FY26 playbook, as articulated by Chairman Mr H M Bangur in a recent media interview (Link), seems decisive and leaves little room for ambiguity.

Shree Cement's Q4FY25 revenue rose slightly, owing to an increase in sales volume. The company's growing focus on premium products improved average realisation per tonne in the quarter. The company is also continuing to focus on increasing the share of green power, which will further reduce the cost of producing cement. Despite the decrease in the cost of sales, higher employee costs, other operating expenses and tax outgo shrunk the profit margin this quarter. For FY26, the company projects cement demand to grow 6.5%-7.5%, owing to sustained capex in infrastructure projects, recovery in the rural economy, continuing...

Keeping up with its ‘industry-superior’ performance trend, Shree Cement (SRCM) reported a fabulous Q4FY25. Adjusted EBITDA/t stood at a whooping INR 1,459, surging 35% QoQ (reported being INR 1,404) being 7% ahead of our estimate.

SRCM commissioned 3mtpa GU at Etah (UP) and 3.4mtpa GU at Baloda Bazar (CG), taking its total cement production capacity to 62.8mtpa. SRCM delivered robust operating performance in Q4FY25 on the back sharp 4.5% QoQ jump in NSR while volumes grew at moderate pace, 3.3% YoY to 9.84mt. SRCM continued to adopt value over volume strategy in FY25 and achieved industry leading EBITDA/t however volume remained flattish....

Shree Cement’s Q3FY25 performance missed our projections. Revenue declined to INR 45,727 Mn, down 12.0% YoY (+12.8% QoQ). The QoQ growth was driven by robust volume expansion partially offset by decline in realization.

Shree Cement’s Q2FY25 result missed our projections despite revenue in line with our estimates.
Revenue declined to INR 40,542 Mn, down 15.1% YoY (-20.9% QoQ) due to weaker realization and a decline in volumes.

We retain a Buy rating on Shree Cement with a revised PT of Rs. 28,800, factoring a marginal downward revision in operational profitability led by lower volume growth than earlier envisaged.

Realisation dent drags revenue growth by a steep 19%/23% in Q2FY25, partially offset by relatively lower volume decline of 7% YoY

We maintain our HOLD rating on the company

Shree Cements’ Q2 was muted due to the weak demand-pricing environment, owing to prolonged monsoons and low infrastructure spends by the government.

Shree Cement (SRCM)’s 2QFY25 EBITDA was in line as lower-than-estimated
realization/t was offset by lower-than-estimated opex/t.

Maintaining market share will be the key priority in the supply glut market situation, though capacity utilisation may hover ~70%

Shree Cement’s Q1FY25 result missed our projections despite revenue in line with our estimates.
Despite falling cement prices, revenue increased 1.8% YoY (-5.1% QoQ) to INR 51,240 Mn led by strong volume growth.

We change our rating from BUY to HOLD

Shree Cement’s (SRCM) volume focus in Q1FY25 was exceptional given it stood flat QoQ (up 8% YoY) as against 5-20% drop reported by industry majors.

Standalone revenues marginally lagged estimates at Rs. 4835 crore (down 2.7% y-o-y) as lower than
estimated realisations (down 10% y-o-y, on higher sales in the Eastern region.