With 25.26 million tonnes cement capacity now, JK Cement's announced expansion would take it to 32 mt by FY26. Its long-term target of 50 mt by 2030 remains. The continuous cost efficiency focus with higher share of renewable energy (60% by FY26) would aid in Rs 150- 200/tonne cost savings in coming years. Greater profitability with cost optimisation and volume growth would keep net debt in check.
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Anand Rathi Report
While the ongoing expansion would take grey cement capacity to ~32 million tonnes by FY26, JK Cement Ltd. aims at 50 mt capacity by 2030. It intends to raise the share of green power to 75% by FY30.
While ramping up the expanded capacity would push volume growth, its focus on increasing the share of green energy would help cost rationalisation.
We retain our Buy rating, with a 12-month target price of Rs 7,678 (Rs 6,342 earlier), 18.5x Sep'27e EV/EBbitda.
Risks: Demand slowdown, rise in petcoke and diesel prices.
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