Shree Cement stock rises 3% after Q2 results; time to buy, sell or hold?

Shares of Shree Cement Ltd gained as much as 2.9 per cent in Wednesday’s trade to hit a day’s high of Rs 29,433.95 on the BSE, compared with the previous close of Rs 28,593.70. The stock drew buying interest after the cement major posted its September quarter (Q2FY26) results.

Brokerages were split on the earnings report. Choice Institutional Equities termed the results weaker than expectations, whereas Nirmal Bang Institutional Equities said the performance was in line with its projections.

The divergence, analysts said, stems from Shree Cement’s value-over-volume strategy. Nuvama highlighted that the company continued to prioritise realisations over volumes, with sales volumes growing 4–6.8 per cent YoY. A key positive was the increasing share of premium products, which rose to 21.1 per cent of trade volume from 14.9 per cent a year earlier.

 Additionally, the company reported a record performance in its UAE operations, where subsidiary EBITDA surged around sixfold YoY, according to JM Financial.

For the full year, management retained its FY26 volume guidance at 37–38 million tonnes. Its ongoing capacity expansion plan remains largely on track, targeting 67–69 MTPA by FY26-end, though the longer-term goal of 80 MTPA has been pushed to FY29. The company also aims to enhance cost efficiencies by raising rail logistics share from 11 per cent to 20 per cent, which could save about Rs 100 per tonne, management said.

Choice Institutional Equities maintained a “Sell” rating with a revised target price of Rs 26,900, stating that strong fundamentals are already priced in and calling it among the richest-valued cement stocks, with returns that do not cover the cost of capital.

JM Financial retained an “Add” rating but trimmed its target price to Rs 31,000, factoring in the Q2 miss and rising competitive intensity.

Nuvama maintained a “Hold” with a slightly revised target of Rs 31,120, while Nirmal Bang also reiterated a “Hold” with a target of Rs 30,322, noting that the stock is “trading at 14.5x FY27E EV/EBITDA, below its five-year average of 22.8x.”

Axis Securities maintained its ‘Buy’ rating on the stock, though it trimmed its target price to Rs 31,655 from Rs 33,960. The brokerage noted that Q2 results were a mixed bag, with a revenue beat and PAT-beat, but an EBITDA margin miss.