'Buy' Shree Cement Shares Maintains ICICI Securities — Here's Why

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ICICI Securities Report

Shree Cement Ltd.’s FY26 playbook, as articulated by Chairman Mr HM Bangur in a recent media interview, seems decisive and leaves little room for ambiguity. Prioritising ‘value over volume’, Shree Cement has guided:

1. 2–3% volume growth vs 7–8% estimated for industry;

2. a target Ebitda/tonne of Rs 1,400 – being broadly at par with Q4 FY25 (FY25 stood Rs 1,070/t). The volume guidance corroborates our channel-check findings viz., Shree Cement restraining its volume-push and focussing not just on higher pricing, but also on narrowing the gap with larger peers.

Further, cash-rich Shree Cement has hinted at a special reward for shareholders in year 2025 (incidentally marks Shree Cement’s 40th anniversary since commencing operations).

By and large, the company’s stance (value over volume) is in sync with our December 2024 sector upgrade hypothesis of a pronounced tapering in industry-wide competitive intensity.

The improving margin outlook for the sector keeps us as enthused as before; maintain Buy with an unchanged target price of Rs 35,330.

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