Shree Cement slips for 3rd day, down 2%; Axis Securities sees 11% upside

Shares of Shree Cement Ltd declined for the third straight session on Tuesday, slipping over 1 per cent on the BSE, even as the cement major posted a 131.1 per cent year-on-year (YoY) rise in net profit for the June quarter of FY26. The company reported a net profit of Rs 643.66 crore for Q1 FY26, up from Rs 278.45 crore in the corresponding quarter last year. However, the strong earnings failed to lift market sentiment on the counter.

On Tuesday, the scrip touched a high of Rs 30,999.85 apiece, but soon it slipped to a low of Rs 30,239.25, down 2.4 per cent from the day’s peak, and 1 per cent lower than its previous day's closing of Rs 30,620.90 apiece.

At current levels, the stock is down nearly 7 per cent from its 52-week high of Rs 32,508.20.

Shree Cement said its revenue from the operations rose 3 per cent for the quarter to Rs 5,280.88 crore against Rs 5,123.96 crore in the corresponding quarter last year.

Axis Securities said that Shree Cement reported a positive set of numbers. “While Revenue/EBITDA/PAT increased by 2 per cent/34 per cent/95 per cent YoY, volume declined by 7 per cent YoY. While PAT growth was above expectations, Revenue/EBITDA/Volume growth was below expectations by 9 per cent/14 per cent/12 per cent, as the company chose to grow profitably,” the brokerage said.

“Shree Cement is prioritising profitability over pure volume growth. The company aims to drive margin expansion through a focused strategy: increasing the share of premium and blended cement products, scaling up green energy usage, optimising its supply chain, and implementing a more effective pricing approach,” Axis Securities said.

The company’s capacity expansion plans also remain on track. Axis Securities said that Shree Cement’s installed capacity currently stands at 62.8 MTPA, with plans to reach 68.8 MTPA by FY26-end. “This calibrated expansion supports our volume CAGR estimate of 6 per cent over FY25–FY27E, driven by improved regional penetration and incremental gains from new capacities,” the brokerage said.

“Robust cement demand and further consolidation in the industry are expected to benefit large players such as Shree Cement,” Axis Securities said.

The brokerage retained its ‘BUY’ recommendation on the stock with a target price of Rs 33,960, implying an 11 per cent upside.