Star Cement Ltd. share price target

Despite lukewarm volume growth (up 4% YoY) and a sharp surge in cost/t (up 12% QoQ), Star Cement (Star) sustained its industry-superior EBITDA/t for Q1FY27 as well (at INR 1,244; even after excluding INR 192/t of incentives).

Star Cement’s quarterly performance was impacted owing to assembly elections in key operating region along with elevated cost and reduced incentive on change in scheme by Assam Govt.

Q4FY26 was yet another strong quarter for Star Cement (Star) with EBITDA racing 20% YoY/56% QoQ (7% ahead of our estimate).

We maintain our BUY rating on the stock.

Focus on cost reduction initiatives to improve EBITDA/ton going ahead: Company's EBITDA/ton stood at 1703/ton in FY26, up ~38.6% YoY led by improvement in realisations, favourable cost structure and positive operating leverage. Management has guided overall cost impact of ~250300/ton in H1FY27 mainly due to packaging costs amid West Asia crisis and has also guided EBITDA/ton of ~15001700/ton for FY27E-28E. We believe that though company's cost structure is affected due to higher input cost in near term, EBITDA/ton to remain strong going forward, led by continuous focus on...

strong foothold in North-Eastern region and a rapidly expanding presence in Eastern region states also (like West Bengal and Bihar) Company has market share of ~27% in North-East markets Q3FY26 performance: Revenue increased by 22.4% YoY (+8.5% QoQ) to Rs 880.0 crores, led by strong volume growth of 22.3% YoY (+8.5% QoQ) to 1.3 mtpa. Net realization remained flat on YoY basis (-2% QoQ). EBITDA/ton increased by 58.9% YoY (-3.9% QoQ) to Rs 1562/ton. Subsequently, EBITDA came at Rs 202.5 crore...

We maintain our BUY rating on the stock.

We interacted with the senior management of Star Cement (Star), for a deep dive into their growth plans and competitive scenario in the Northeast.

With 9.7m cement tpa now, Star Cement is targeting 18m-20m tpa by FY30. Greater operational efficiency with the stabilised clinker unit, incentives from capacity commissioning and the rising share of green energy (aimed at 55-60%) would aid the operating performance.

We maintain our BUY rating on the stock.

With healthy volume growth and healthy improvement in EBITDA/ton over FY25-28E, we expect revenue to grow ~15% CAGR over FY25-28E while EBITDA & PAT are expected to grow at ~30% & ~50% CAGR respectively. We recommend BUY on Star Cement with a revised target price of Rs 300...

The stock is currently trading at 12.5x/11.5xFY26E/27E EV/EBITDA. We recommend a BUY on the stock with a TP of Rs 288/share, implying an upside potential of 10% from the CMP.

We maintain our BUY rating on the stock with a TP of Rs 325/share, implying an upside potential of 27% from the CMP.

We interacted with Tushar Bhajanka, Deputy MD of Star Cement, to understand the company’s growth plans and the demand-supply outlook in the Northeast.

Superior profitability to sustain, led by focus on operating efficiencies: During Q1FY26, company's profitability improved sharply on YoY basis (EBITDA/ton stood at Rs 1761/ton, +75% YoY), led by better volume growth, improvement in realisations and lower RM cost. We believe that company's EBITDA/ton to remain strong going forward, led by continuous focus on operational efficiencies (led by increase in share of renewable power, WHRS and captive coal, freight cost optimisation through addition of grinding units in NE and Rajasthan), incentives from state government & positive operating...

We maintain our BUY rating on the stock.

Revenues rose ~21% YoY in Q1FY26 on ~12% volume gains, including clinker sales, though realisations stayed flat (+1% YoY)

We recommend a BUY rating on the stock with a TP of Rs 237/share, implying an upside potential of 10% from the CMP.

We assume coverage on Star Cement (Star) with BUY and target price of Rs250, while valuing the stock at FY27E EV/EBITDA of 12x. Star, with the upcoming commissioning of grinding units (GUs) in Silchar and Jorhat (both in Assam) is set to consolidate its leadership position in the Northeast.