Buy Star Cement stock for 28% upside, says Axis Securities; here’s why
Axis notes Star Cement is well-positioned to capitalise on robust demand growth, buoyed by infrastructure development and government initiatives in the North-East and Eastern regions.
- Sep 30, 2025,
- Updated Sep 30, 2025 2:43 PM IST
Axis Securities has reiterated its ‘Buy’ call on Star Cement after evaluating the company’s FY25 Annual Report, recent strategic developments, and overall growth prospects.
The brokerage values Star Cement at 12x FY27E EV/EBITDA, arriving at a target price of Rs 325 per share, which implies a 28 per cent upside from the current price of Rs 252.50.
Axis notes Star Cement is well-positioned to capitalise on robust demand growth, buoyed by infrastructure development and government initiatives in the North-East and Eastern regions. The company’s strategy includes capacity expansion, premiumisation, and a strong sustainability focus.
Star Cement has aggressively increased its production capabilities, having commissioned a 3.3 mtpa clinker grinding unit in Meghalaya. There are plans to bring two more grinding units online by FY27, which would raise the total capacity to 11.7 mtpa. Furthermore, a strategic entry into the Rajasthan market via limestone mines aims to reduce geographic concentration and unlock new growth opportunities. The company has demonstrated operational excellence, with approximately 90 per cent utilisation at its new plants, supporting robust volume growth, Axis said
Premium cement sales surged 85 per cent year-on-year in FY25 and now account for 11 per cent of trade sales, driven by a new premium brand launch and assertive marketing efforts. Star Cement’s position as a market leader in the North-East—with 27 per cent market share and a distribution network of more than 2,000 dealers and 12,000 sub-dealers—confers competitive strength. The North-East market continues to witness faster cement demand growth than the national average, backed by substantial infrastructure investments in roads, airports, hydropower, and railways.
The company’s focus on sustainability and operational efficiency was also highlighted, with government subsidies supporting cash flows and further capacity additions planned. Axis Securities projects a strong volume CAGR of 12 per cent, revenue growth of 16 per cent, and EBITDA and PAT CAGRs of 31 per cent and 52 per cent, respectively, for the period FY25–27.
Axis Securities distinguishes Star Cement from its main competitors by emphasising its market leadership in the North-East and ongoing efforts in market diversification and premiumisation.
Axis Securities has reiterated its ‘Buy’ call on Star Cement after evaluating the company’s FY25 Annual Report, recent strategic developments, and overall growth prospects.
The brokerage values Star Cement at 12x FY27E EV/EBITDA, arriving at a target price of Rs 325 per share, which implies a 28 per cent upside from the current price of Rs 252.50.
Axis notes Star Cement is well-positioned to capitalise on robust demand growth, buoyed by infrastructure development and government initiatives in the North-East and Eastern regions. The company’s strategy includes capacity expansion, premiumisation, and a strong sustainability focus.
Star Cement has aggressively increased its production capabilities, having commissioned a 3.3 mtpa clinker grinding unit in Meghalaya. There are plans to bring two more grinding units online by FY27, which would raise the total capacity to 11.7 mtpa. Furthermore, a strategic entry into the Rajasthan market via limestone mines aims to reduce geographic concentration and unlock new growth opportunities. The company has demonstrated operational excellence, with approximately 90 per cent utilisation at its new plants, supporting robust volume growth, Axis said
Premium cement sales surged 85 per cent year-on-year in FY25 and now account for 11 per cent of trade sales, driven by a new premium brand launch and assertive marketing efforts. Star Cement’s position as a market leader in the North-East—with 27 per cent market share and a distribution network of more than 2,000 dealers and 12,000 sub-dealers—confers competitive strength. The North-East market continues to witness faster cement demand growth than the national average, backed by substantial infrastructure investments in roads, airports, hydropower, and railways.
The company’s focus on sustainability and operational efficiency was also highlighted, with government subsidies supporting cash flows and further capacity additions planned. Axis Securities projects a strong volume CAGR of 12 per cent, revenue growth of 16 per cent, and EBITDA and PAT CAGRs of 31 per cent and 52 per cent, respectively, for the period FY25–27.
Axis Securities distinguishes Star Cement from its main competitors by emphasising its market leadership in the North-East and ongoing efforts in market diversification and premiumisation.