Target: ₹295
CMP: ₹219.20
Star Cement reported healthy growth across financial parameters led by robust year-on-year volume growth of 21.5 per cent. Revenue/EBITDA/PAT grew 22.4 per cent/94.3 per cent/720.3 per cent to ₹880 crore/₹203 crore/₹74 crore respectively. PAT saw significant jump, primarily on low base, from about ₹9 crore to ₹74 crore.
The company’s capex plans remain intact. Silchar grinding unit of 2 mtpa is expected to commission by February-end, 2026. Star Cement has plans to set up units in Bihar, Assam, Rajasthan and Haryana. The overall capex for four major projects is estimated at ₹4,800 crore with commissioning targeted by H2FY29 or early-FY30. With the current capex plans, Star Cement’s total cement and clinker capacities are expected to increase to 16.7/9.1 mtpa from 7.7/6.1 mtpa respectively by FY30. This excludes its plan to add 2-mtpa cement capacity and clinker capacity in Assam, which is currently deferred.
The company is expected to raise funds through QIP in order to meet the capex needs with an aim to maintain Debt/EBITDA ratio of <1.5x.
Star Cement’s new business verticals, part of its forward integration plans, will be additional growth driver. Due to improved demand and operating leverage, we upgrade our FY26E/FY27E EPS estimates by 16.9 per cent/2.1 per cent to ₹7.9/8.4, respectively. We value the stock at 13.9x of its rolling one-year forward EV/EBITDA and keep our target price unchanged at ₹295.
Published on February 11, 2026
