JK Cement surges 5% on strong volume growth, upbeat brokerage views

Cement maker JK Cement shares spiked sharply on Tuesday, gaining as much as 5.36 per cent to touch an intraday high of ₹6,100 per share amid bullish sentiment from market participants. 

 

By 12:15 am, the stock was off day’s high, but continued to trade 0.9 per cent higher at ₹5841.60 on the BSE, considerably outperforming the broader market, where the Sensex was down 0.46 per cent at 82,860.72 levels.

 

The rally in JK Cement came against a weak broader market backdrop, signalling selective buying in heavyweights that are perceived to have strong earnings triggers ahead. Analysts remained constructive on the cement company’s outlook, highlighting strong operational performance, improving demand trends and sustained execution on expansion plans as key catalysts.

 

 

Choice Institutional Equities maintains Buy, sees ₹7,200 target

 

In its latest note, Choice Institutional Equities reaffirmed its ‘Buy’ rating on JK Cement, assigning a target price of ₹7,200,  implying major upside from prevailing levels. The brokerage outlined several “near-term positive triggers” that support the bullish stance.

 

Key pillars of its investment thesis include expected cement sector tailwinds, such as improving demand and healthy pricing, heading into the March quarter and FY27. Choice also pointed to JK Cement’s aggressive capacity expansion roadmap, which it expects to take the company’s annual production capacity to over 36 million tonnes by FY27 end from ~28.7 million tonnes as of December 2025.

 

A focus on cost efficiencies, notably through increasing adoption of green power with a target of 75 per cent renewable energy by FY30, was cited as another structural strength. The brokerage also highlighted the company’s disciplined leverage strategy, with net debt to Ebitda comfortably below 2x, and a projected expansion in return on capital employed (ROCE) by approximately 495 basis points over FY25-28E.

 

Choice used an EV/CE (Enterprise Value to Capital Employed) based valuation framework to arrive at its target, expecting robust fundamentals to justify a multiple of 3.7x for FY27E and FY28E. Under its forecasts, JK Cement’s Ebitda is projected to grow at a CAGR of 20.1 per cent over FY25-28E, driven by volume growth of 8-10 per cent annually and steady realisation growth in the near term.  CATCH STOCK MARKET LIVE UPDATES TODAY 

Elara Capital sees market share gains, keeps ‘Accumulate’ rating

 

Elara Capital retained its 'Accumulate' rating on JK Cement with an unchanged SoTP target of ₹6,249. The brokerage noted that the company delivered Q3 FY26 Ebitda of around ₹540 crore, marginally ahead of both its own and consensus estimates, driven by stronger-than-expected volumes. Elara highlighted that JK Cement continues to gain market share in Central India, particularly in the non-trade segment, which helped offset pressures on average realisation.

 

Lower power and fuel costs and operating leverage benefits further supported earnings performance, the brokerage said. Elara also pointed to indications of a recovery in the company’s UAE operations, with improving margins reflected in the widening gap between standalone and consolidated Ebitda in recent quarters.

 

Looking ahead, Elara expects performance to improve as existing capacities ramp up and incremental additions come on stream, supported by cost-savings initiatives.

 

Motilal Oswal sees resilient demand; reiterates ‘Buy’

 

Motilal Oswal also remained positive, reiterating its ‘Buy’ recommendation with a target price of ₹6,685, valuing JK Cement at 17x FY28E EV/Ebitda. The brokerage noted that industry demand remained robust through the third quarter, with December volumes staying strong and plant utilisations high.

 

Motilal Oswal expects cement demand growth of 6-7 per cent year-on-year (Y-o-Y) in Q4FY26 and 7-8 per cent in Q1FY27, buoyed by improving pricing dynamics. It further pointed out that non-trade cement prices have firmed up by ₹15-20 per bag, narrowing the discount with trade prices, a factor it believes will help reduce margin pressure.

 

That said, the convergence of strong volume growth, improving pricing conditions, strategic capacity expansion and structural cost efficiency initiatives underpins the bullish outlook for JK Cement among brokerages.      

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