Nomura upgrades Shree Cement shares to 'buy' on improving utilization; stock rallies 4%

Over the past 12 months, shares of Shree Cement have rallied 20 percent.

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Shree Cement Ltd. shares jumped four percent intraday on March 28, after the cement player bagged a rating upgrade from Japanese brokerage Nomura. This move comes after Nomura had downgraded Shree Cement shares to 'neutral' in January.

Nomura upgraded its rating on Shree Cement to 'buy', up from 'neutral' earlier, and hiked its target price to Rs 34,000 per share, compared to Rs 28,000 earlier, implying a 12 percent upside from the previous session's closing price.

The brokerage reversed its earlier stance, as it had downgraded Shree Cement shares in January 2025, 'neutral' from the previous 'buy' rating.  Today's  rating upgrade comes amid Shree Cement's improved utilization levels and a strong recovery in cement markets amid rising demand.

At 1 pm, shares of Shree Cement were quoting Rs 30,718.55, higher by 1.9 percent on the NSE.

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Nomura has raised its volume estimates for Shree Cement for financial years 2026 and 2027 by 5 percent and 7 percent to 41 million tonnes and 46 million tonnes, respectively.

The revision comes as the company improves capacity utilization in northern and eastern India, which, when combined, account for over 80 percent of its total volumes. Both regions have seen stronger pricing, with a 4 percent QoQ increase, compared to 2 percent QoQ hike across India, the brokerage noted.

Nomura also raised its EBITDA estimates for 2026 and 2027 by 9 percent and 15 percent to Rs 4,900 crore and Rs 6,500 crore, respectively.

For the fourth quarter, it expects Shree Cement’s EBITDA to exceed Rs 1,300 per tonne, aided by better realizations and lower fuel costs.

Nomura anticipated the Indian cement industry to witness better volume growth in FY26 than FY25, it believes only cost focused companies would manage to witness margin expansion. On that account, Nomura sided with industry leaders as its choice within India's cement space.

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