Target prices for Ambuja, ACC, Ramco, JK Cements post Q2 results; buy, sell or hold?

India’s cement sector reported a mixed performance in the second quarter of FY26, as companies grappled with muted realisations and rising input costs. Following the earnings season, leading brokerages have revised their outlook on key players, reflecting a blend of optimism and caution.

Ambuja and ACC: ‘Buy’ calls retained

Choice Institutional Equities (CIE) has reiterated its ‘Buy’ rating on Adani Group’s Ambuja Cements and ACC, citing aggressive expansion plans and strong group synergies.

CIE maintained its ‘Buy’ on Ambuja Cements with a target price of Rs 700, highlighting the company’s Q2 performance as a volume driven beat. Choice said its optimism is anchored on an ambitious capacity expansion targeting 155 Mnt by FY28E, a significant cost-reduction plan aiming for Rs 300 per tonne in savings, and operational benefits from group integration.

Similarly, Choice reaffirmed its ‘Buy’ on ACC Ltd, with a target price of Rs 2,475 — implying a potential upside of over 35 per cent from current levels. The company’s Q2 EBITDA improved on account of lower operating expenses, with EBITDA per tonne surging 58.5 per cent year-on-year to Rs 732. CIE expects ACC’s growth momentum to continue, supported by its planned expansion in Southern India through the Penna Cement acquisition, cost-reduction target of Rs 500 per tonne by FY28E, and group-level efficiency gains.

Ramco Cements: ‘Reduce’ rating on leverage concerns

Despite an operational beat in Q2FY26, with EBITDA coming in 6–7 per cent ahead of consensus estimates, JM Financial has retained its ‘Reduce’ rating on The Ramco Cements, maintaining a target price of Rs 1,000 — below its prevailing market price.

JM Financial flagged concerns that the company’s leverage to remain high, citing elevated capex intensity and projecting net debt to remain in range of Rs 4,000–4,500 crore. JM Financial also pointed to slower monetisation of non-core assets and trimmed its EBITDA estimates for FY26–28 accordingly.

JK Cement: ‘Hold’ call on premium valuation

Axis Securities has maintained its ‘Hold’ rating on JK Cement Ltd and revised its target price to Rs 6,180 from Rs 6,530. The company’s Q2 results were mixed, with strong volume growth offset by an EBITDA margin miss on higher costs.

Axis noted that growth visibility on volumes remains intact, supported by an expected 13 per cent volume CAGR over FY25–FY27E, it cautioned that the stock is trading at a premium. Axis sees only limited upside potential of 7 per cent from current levels.

Brokerages remain divided as the cement industry faces near-term challenges. JM Financial, in a sector update, noted that pan-India average cement prices declined 1.5 per cent month-on-month in October 2025.

The report highlighted a deeper non-trade stress as prices fell more sharply in the non-trade segment. Rising input costs, including petcoke, coupled with demand disruptions due to rainfall and festivities, have weighed on margins. JM Financial warned that profitability in the third quarter looks “challenging” and that any near-term price hikes could be constrained by “GST surveillance and anti-profiteering concerns”.