Buy Ramco Cements; target of Rs 1226: Anand Rathi

HDFC Securities research report's outlook and valuations:  "The YTD EPS upgrades (consensus) have been led by mid-tiers such as Tata Elxis, Mindtree, Mastek, and Persistent Systems, ranging from 20-40 percent and, within tier 1, by Wipro (~15%). We expect the sector (coverage universe) to post 13 percent and 14.5 percent USD revenue/APAT CAGR over FY21-24E compared to 6.5/7.5 percent over the past five years. The mid-tier valuation premium relative to tier 1s may sustain, based on its relative outperformance (>500bps growth outperformance over FY21-24E as compared to 250bps earlier). We roll over valuations to Sepemtember-23E and increase target multiples for most of the companies in our coverage universe. We remain broadly constructive across the sector and ahead of consensus on growth/EPS; our preferred picks are Infosys, HCLT, Mphasis and Zensar."

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26 Aug, 2025 12:21

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Anand Rathi's research report on Ramco Cements

Outpacing our estimates, Ramco’s volumes were firm. Still rising costs took a toll on its operating performance. While the near-term cost-rise continuing is uncertain, the greater share of green energy, plant modernisation and price hikes would provide the necessary boost. The delevering will be subject to WC needs and growth capex.

Outlook

We maintain our Buy rating, with a higher target price of Rs.1,226 (earlier Rs.1,205).

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