ICICI Securities's research report on Ramco Cements
The Ramco Cements’ (TRCL) Q2FY26 EBITDA at INR 3.9bn (up 24% YoY/down 3% QoQ) stood just 4% ahead of our estimates despite a massive volume beat (being 13% ahead of forecast; up 10% QoQ though flattish YoY). Costs shoulder the blame with ‘other expenses’ rising 15% YoY while variable cost/t too inched up 1% QoQ. Calibrating for H1FY26 performance and the bleak near term cement price outlook (led by the underlying GST rate cut transition phase), we chop FY26/27E EBITDA by 11%/7%. Factoring in the high leverage (2.4x net debt/EBITDA for FY26) and muted RoE profile (5-9% over the next two years),
Outlook
We continue to value TRCL at 13x FY27E EV/EBITDA and maintain HOLD with a revised target price of INR 1,011 (vs. INR 1,088).
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