Shree Cement (SRCM IN) – Q4FY26 Result Update – Volumes rebound; pricing gap rectified; will it sustain? – ACCUMULATE
Published on 07 May 2026
SRCM has also curtailed FY27 capex from Rs30bn (Q2 concall) to Rs15bn as mgmt. is aligning with industry peers to improve its utilization (66% in Q4). It is prioritizing its North-East market entry with 1mtpa IU in the first phase and intends to increase to ~4mtpa in subsequent phases. In the existing key markets, pricing is now almost stabilized (with reduced gap with the leader) and mgmt. would focus on improving volumes at this pricing driving profitability. Execution on this balanced strategy remains a key monitorable going ahead. Near-term fuel and packaging cost pressures are expected to persist, making price hikes and cost optimisation critical for margin protection. SRCM’s strong balance sheet, cost leadership and rising renewable energy share should continue to support earnings resilience. We tweak our FY27/28E EBITDA estimates by -3/+2% factoring in higher cost assumptions. At CMP, the stock is trading at 17.2x/15x FY27/FY28E EV/EBITDA. Maintain ‘Accumulate’ with a revised TP of INR27,907 (earlier INR27,370), valuing the stock at same 17x Mar’28E EV/EBITDA.
