Star Cement Ltd Q2 FY26 – The North-East Cement Don Bags ₹811 Cr Sales, ₹72 Cr Profit, and a ₹1,500 Cr War Chest for Expansion
1. At a Glance
Move over Ambuja, make some space Ultratech — the cement mafia from the hills, Star Cement Ltd, is here with a fresh batch of numbers (and concrete confidence). For Q2 FY26, Star Cement clocked ₹811 crore in revenue and ₹72 crore in net profit, with an operating margin of 23% that would make even Ambuja say “wah!”.
The stock, trading at ₹251 (down 3.2% today because investors can’t handle good news calmly), carries a market cap of ₹10,160 crore and a P/E of 33.6x, roughly at par with industry biggies like Dalmia Bharat and Grasim. The company’s PAT jumped 1,153% YoY (yes, that’s not a typo) — largely because the same quarter last year was a washout.
But that’s not the full story — Star just announced a fund-raising plan of ₹1,500 crore (postal ballot underway) to finance its aggressive capacity expansion. Cement bros out there, this one’s playing for scale.
With debt at ₹643 crore, ROE of 6%, and ROCE of 8.4%, the balance sheet’s got space to take on a little more masala. Oh, and it’s still the largest cement manufacturer in North-East India with a 24% market share and one of the best limestone reserves in the region.
Let’s pour this mix and set it properly — because this story has all the ingredients: limestone, liquidity, and a few boardroom resignations for extra texture.
2. Introduction
In the middle of India’s cement battlefield, where Ultratech and Shree Cement throw billions into TV ads and capital projects, Star Cement has been quietly building its empire from the hills of Meghalaya. It’s a regional beast that commands the North-East like Virat Kohli in his prime.
The company manufactures Ordinary Portland Cement (OPC), Portland Pozzolana (PPC), Anti-Rust Cement (ARC), Portland Composite Cement (PCC), and Weather Shield Cement (WSC) — basically, if it hardens, Star makes it.
Star Cement’s 5.7 MTPA cement capacity and 2.8 MTPA clinker unit are supported by an impressive 51 MW captive power setup (plus 12.3 MW WHRS). But they’re not done — by FY26, they’re targeting a 10 MTPA capacity, making them a legitimate pan-India contender.
Despite having one of the finest limestone reserves and a loyal dealer network of 2,000+ dealers and 11,000+ merchants, the company’s profit margins and return ratios have been under pressure. Why? Because cement is a dirty, capital-hungry game — the kind where your kiln has to be hot even when your sales are cold.
Still, the company’s playing smart — expanding solar, merging subsidiaries, and bidding for limestone blocks like it’s going out of style.
3. Business Model – WTF Do They Even Do?
Star Cement does what it says on the bag — makes cement, sells it, and repeats until the economy runs out of infrastructure dreams.
Here’s the model in simple desi terms:
Clinker is produced in Meghalaya.
Cement grinding units operate in Assam and West Bengal.
The product moves through an army of distributors to reach small-town builders, contractors, and retail shops across the North-East, West Bengal, and Bihar.
The trade sales (to distributors/dealers) make up around 86% of revenue — showing Star is a brand-heavy player, not just a bulk supplier.
It’s also diversifying into AAC blocks, solar power, and waste heat recovery systems (WHRS) — basically trying to make every calorie of limestone and coal count.
But behind the numbers, there’s an important truth: Star Cement’s edge is location. Its factories sit right next to limestone mines, cutting logistics costs in half — while competitors like Dalmia Bharat or ACC must haul raw materials across states.
4. Financials Overview
Source table
Metric (₹ Cr)
Latest Qtr (Sep’25)
YoY Qtr (Sep’24)
Prev Qtr (Jun’25)
YoY %
QoQ %
Revenue
811
642
912
26.4%
-11.1%
EBITDA
190
96
228
98.0%
-16.7%
PAT
72
6
98
1,153%
-26.5%
EPS (₹)
1.78
0.14
2.44
1,171%
-27.0%
Annualised EPS: ₹7.1 → P/E ≈ 35x at CMP ₹251.
Margins are the real story here — OPM of 23%, which is solid given input cost volatility. But the fall in QoQ profit (-26%) shows that monsoon and energy prices are still the natural enemies of cement.
5. Valuation Discussion – Fair Value Range
Method 1: P/E Multiple
Industry P/E: 36.4
EPS (TTM): ₹7.49
Fair Value = ₹7.49 × (28–38) = ₹210–₹285
Method 2: EV/EBITDA
EV = ₹10,657 crore
EBITDA = ₹785 crore
EV/EBITDA = 13.6×, roughly near peer average (12–14×). → Implied fair range = ₹720–₹1,000 crore EBITDA × 12–14 = EV ₹8,640–₹11,200 crore → Equity value (after ₹643 crore debt) ≈ ₹8,000–₹10,500
