1. At a Glance
India’s 5th largest cement maker in the North is now flexing more than just bags of grey cement. Q1 FY26 showed 21% OPM, a ₹195 Cr expansion plan, and profit growth of 75% YoY. With ₹50,000 Cr market cap, JK Cement is transitioning from dusty bags to dividend-bearing dynamite.
2. Introduction with Hook
If Indian cement companies were rock bands, JK Cement just dropped its comeback album — and it’s all killer, no filler.
- Q1 FY26 Net Profit: ₹324 Cr
- Operating Profit: ₹688 Cr with 21% OPM
- New Wall Putty Plant = ₹195 Cr Capex expansion approved
And yes, the stock has delivered 52% returns in 1 year. Cementing its case? Maybe.
3. Business Model (WTF Do They Even Do?)
JK Cement operates across:
- Grey Cement — The bread and butter (~85% rev)
- White Cement + Wall Putty — High-margin segments (~15%)
- Brand Portfolio: JK Super Cement, JK Wall Putty
- Capacity: 20+ MTPA, with a recent 0.5 MTPA bump
They serve both infrastructure & real estate sectors, giving a dual demand engine.
4. Financials Overview
| Year | Revenue ₹ Cr | EBITDA ₹ Cr | Net Profit ₹ Cr | EPS ₹ | OPM % | ROE % |
|---|---|---|---|---|---|---|
| FY22 | 7,991 | 1,513 | 679 | 88.9 | 19% | 13% |
| FY24 | 11,556 | 2,071 | 790 | 102.3 | 18% | 14% |
| FY25 | 11,879 | 2,034 | 872 | 111.4 | 17% | 14% |
| TTM | 12,424 | 2,229 | 1,012 | 129.4 | 18% | 14% |
Summary:
- High double-digit EBITDA margins maintained
- EPS CAGR (3Y): 13%
- ROE stable despite rising depreciation (capex heavy)
5. Valuation
a) P/E Based
- EPS TTM = ₹129.45
- P/E = 54.8x
- Sector Median = 35x
- Fair Value Range = ₹4,500–₹6,800
- CMP = ₹6,498 → Near upper bound = needs growth trigger
b) Price to Book
- Book Value = ₹788
- P/BV = 8.25x → Rich. Even Ambuja trades cheaper.
Verdict: Premium valuation riding on white cement story + expansion plans. But room is limited unless growth surprises.
6. What’s Cooking – News, Triggers, Drama
🔥 Q1 FY26 Standouts:
- Net Profit up 75% YoY (₹324 Cr)
- 0.5 MTPA capacity addition
- ₹195 Cr white cement wall putty plant approved
- 21% EBITDA margin = best in class
📌 Triggers to Watch:
- Ramp-up of white cement capacity
- Export potential (Putty & White Cement to Middle East)
- Demand from infra + housing boom
7. Balance Sheet
| FY | Equity ₹ Cr | Reserves ₹ Cr | Borrowings ₹ Cr | Assets ₹ Cr |
|---|---|---|---|---|
| FY20 | 77 | 2,950 | 3,503 | 8,542 |
| FY23 | 77 | 4,607 | 5,292 | 13,307 |
| FY25 | 77 | 6,012 | 6,028 | 16,682 |
Takeaways:
- Debt is rising but manageable given EBITDA
- Reserves more than doubled in 5 years
- Capex heavy model, asset-heavy balance sheet
8. Cash Flow – Sab Number Game Hai
| Year | CFO ₹ Cr | CFI ₹ Cr | CFF ₹ Cr | Net Flow ₹ Cr |
|---|---|---|---|---|
| FY22 | 878 | -984 | +62 | -44 |
| FY24 | 1,959 | -1,626 | -416 | -83 |
| FY25 | 1,939 | -1,890 | +74 | +123 |
Reading Between the Lines:
- Cash ops strong: ~₹2,000 Cr
- Capex burn remains high
- Net cash flow positive = healthy cash conversion
9. Ratios – Sexy or Stressy?
| Ratio | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROCE | 10% | 16% | 14% |
| ROE | 12% | 14% | 14% |
| Inventory Days | 223 | 235 | 213 |
| Debtor Days | 18 | 18 | 24 |
| CCC (Cash Cycle) | 53 | 78 | 38 |
| Working Cap Days | 33 | 37 | 18 |
Verdict:
Working capital improvements, inventory down — clear supply chain optimization. ROCE back at pre-FY22 levels.
10. P&L Breakdown – Show Me the Money
| FY | Revenue ₹ Cr | OPM % | Net Profit ₹ Cr | EPS ₹ |
|---|---|---|---|---|
| FY22 | 7,991 | 19% | 679 | 88.93 |
| FY23 | 9,720 | 14% | 416 | 54.82 |
| FY24 | 11,556 | 18% | 790 | 102.35 |
| FY25 | 11,879 | 17% | 872 | 111.45 |
Commentary:
- Margin drop in FY23 was temporary
- OPM bounce in FY24–25 driven by better product mix (Putty > Grey)
- FY26 off to a flying start
11. Peer Comparison
| Company | CMP ₹ | P/E | ROCE % | OPM % | EPS ₹ | ROE % |
|---|---|---|---|---|---|---|
| Ultratech | 12,498 | 60x | 11% | 16.5% | 159.2 | 9.3% |
| Shree Cement | 30,790 | 99x | 6.7% | 20.4% | 68.9 | 5.3% |
| Ambuja Cements | 596 | 35x | 10.5% | 17% | 28.7 | 8.7% |
| JK Cement | 6,498 | 54.8x | 14% | 18% | 129.4 | 13.9% |
Interpretation:
Best ROE & ROCE combo among peers. But valuation catching up — no more underdog.
12. Miscellaneous – Shareholding, Promoters
| Shareholder | Jun ’23 | Jun ’25 |
|---|---|---|
| Promoters | 45.8% | 45.68% |
| FIIs | 15.5% | 16.1% |
| DIIs | 23.1% | 24.5% |
| Public | 15.5% | 13.7% |
Notes:
- Strong DII confidence
- Gradual shift from public → institutions
- No dilution trend — steady cap table
13. EduInvesting Verdict™
JK Cement is what happens when a family-run legacy player actually reinvests well, stays relevant, and slaps a premium product line on top.
- Grey Cement = Volume
- White Cement + Wall Putty = Margin
- Capacity Additions = Growth visibility
- Q1 FY26 = Blockbuster
Risks?
- High valuations
- Commodity cost pressures
- Capex-heavy balance sheet
But overall? It’s not just a cement stock.
It’s a margin story hidden in a bag of white powder.
Metadata
– Written by EduInvesting Research | 20 July 2025
– Tags: JK Cement, White Cement, Wall Putty, PSU Cement, Q1 FY26, Expansion, ROE Leaders, Midcap
