Buy J K Cement; target of Rs 7300: Motilal Oswal

Motilal Oswal is bullish on J K Cement recommended buy rating on the stock with a target price of Rs 7300 in its research report dated July 21, 2025.

Broker Research

July 23, 2025 / 15:25 IST

buy

26 Aug, 2025 12:21

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Motilal Oswal's research report on J K Cement

JK Cement (JKCE) reported strong EBITDA growth, up ~41% YoY to INR6.9b (in line) in 1QFY26, led by robust volume growth (~+16%) and improvement in realization (~+3%). EBITDA/t surged ~22% YoY to INR1,226 (in line). Adj. PAT jumped ~75% YoY to INR3.2b (+19% vs. our estimate, fueled by lower depreciation and higher other income). Management highlighted that the Central and South regions propelled strong volume growth, while the North was weak. The average cement price was flat sequentially, as strong pricing in the South was offset by pressure in the Central and Northern regions. JKCE maintained its FY26 grey cement volume guidance of 20mt and aims to achieve cost savings of INR40–50/t. Capacity expansion is progressing on schedule, with Panna and Bihar projects (total clinker/grinding capacity of 4.0mtpa/6.0mtpa) expected to be commissioned by Dec’25.

Outlook

We broadly maintain our EBITDA estimates for FY26-28. We raise our EPS by ~6-7% for FY26/27E due to a lower depreciation estimate. We value JKCE at 18x Jun’27E EV/EBITDA (at a premium to its long-term average) to arrive at our TP of INR7,300. We reiterate our BUY rating on the stock.

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