Introduction – Best Cement Stocks to Buy
India is the second largest cement producer in the world, following China, and is also the third largest consumer of cement and cement products. Housing & Real Estate demands 65% share of cement, followed by Public Infrastructure which requires 25% and Industrial Development has 10% demand for cement. While the pandemic halted many construction projects, cement companies were forced to manage their costs. But since the lockdowns were lifted, many projects have resumed and thus demand is expected to grow. It is imperative that we grab the opportunity to invest in this sector and find the best cement stocks. Cement Industry is highly capital-intensive and has huge fixed costs. It must be evaluated regionally since demand may vary from region to region. Companies that can control fixed costs of logistics and power consumption are the ones with higher profit margins. Companies that have plants spread across the country can control costs related logistics better than their competitors.
Top 10 Cement Stocks in India
Let us look at the cement stocks list to help us decide which ones to invest in for the long term. We will make our decision based on financial ratios since we use Fundamental Analysis for long term investment decisions.
Net profit margin, 3 years CAGR net profit, return on equity, debt to equity ratio, earnings per share, price to earnings ratio, dividend per share, promoter’s shareholding, market capitalization, and change in revenue and net profit are the fundamental analysis parameters we will take into consideration to select best cement stocks for long term investments.
| Name of Stock | Ticker (on NSE) | Net Profit Margin (%) | ROE (%) | Debt to Equity Ratio | EPS (₹) |
| UltraTech Cement | ULTRACEMCO | 13.94 | 14.56 | 0.20 | 254.64 |
| Shree Cements | SHREECEM | 15.56 | 13.35 | 0.12 | 646.31 |
| Ambuja Cements | AMBUJACEM | 12.74 | 10.39 | 0.00 | 14 |
| ACC | ACC | 11.46 | 13.01 | 0.00 | 99.21 |
| The Ramco Cements | RAMCOCEM | 14.87 | 13.31 | 0.59 | 39.00 |
| Dalmia Bharat | DALBHARAT | 10.34 | 7.29 | 0.20 | 61.84 |
| JK Cement | JKCEMENT | 8.50 | 15.88 | 0.89 | 87.90 |
| Birla Corp | BIRLCORPN | 5.34 | 6.58 | 0.70 | 51.76 |
| Heidelberg Cement India | HEIDELBERG | 10.98 | 16.11 | 0.12 | 11.13 |
| India Cements | INDIACEM | 1.35 | 1.31 | 0.52 | 8.92 |
UltraTech Cement
UltraTech Cement Ltd, founded in 2000, is one of the best cement stocks for long term. It is a part of Aditya Birla Group and is India’s largest exporter of Cement Clinker.
The company manufactures and markets Portland Blast Furnace Slag Cement. Ordinary Portland Cement, Portland Pozzalana Cement, ready mix concrete (RMC), white cement and white cement-based products, industrial and precision grout, repair products, tiles adhesives, waterproofing products, plasters, masonry products, and light weight autoclaved aerated concrete block.
UltraTech Cement has a market capitalization of ₹1,91,895 Cr and a P/E Ratio of 25.93. The Dividend/Share is ₹38 and the Promoter’s shareholding is 59.96%. The company’s revenue increased by 17.6% and net profit increased by 36.66% in the fiscal year ended 31st March, 2022. The 3 years CAGR Net Profit is 73.99%.
Shree Cements
Shree Cements Ltd, founded in 1979, is a leading cement manufacturer in North India. The company’s cement manufacturing capacity is nearly 43.4 MTPA (million tons per annum). The products are marketed under the brand names: Bangur Power Cement, Bangur Cement, Roofon Concrete Master Cement, Rockstrong Cement, and Shree Jung Rodhak Cement. The company is also engaged in power generation.
Shree Cements has a market capitalization of ₹77,296.51 Cr and a P/E Ratio of 37.18. The Dividend/Share is ₹90 and the Promoter’s shareholding is 62.55%. The company’s revenue increased by 11.4% and net profit increased by 2% in the fiscal year ended 31st March, 2022. The 3 years CAGR Net Profit is 51.72%.
Ambuja Cements
Ambuja Cements Ltd., founded in 1983, is the third largest cement company in the country. It manufactures and markets cement and clinker in domestic markets as well as export markets. The company has a capacity of approximately 29.65 million tons. Ambuja Cement has five integrated cement manufacturing plants and eight cement grinding units across India. The product portfolio includes Ambuja Cement, Ambuja Plus, Ambuja Kawach, Ambuja Cool Walls, Ambuja Buildcem, Ambuja Compocem, Ambuja Railcem, Ambuja Powercem, and Alccofine.
Ambuja Cements has a market capitalization of ₹83,486.45 Cr and a P/E Ratio of 35.24. The Dividend/Share is ₹6.30 and the Promoter’s shareholding is 63.2%. The company’s revenue increased by 18.15% and net profit increased by 19.34% in the fiscal year ended 31st March, 2022. The 3 years CAGR Net Profit is 11.66%.
ACC
ACC Ltd., founded in 1936, is a cement manufacturing company. The company’s R&D facility is known for innovative research and product development. Their product range includes Ordinary Portland Cement (OPC), Portland Slag Cement (PSC), Portland Pozzalana Cement (PPC) and composite cement and ready-mix concrete. The company has 17 cement manufacturing plants and 85 plants of ready mix concrete. The company has extended its services to Africa, the Middle East, and South America and helps in operating and maintaining cement plants.
ACC has a market capitalization of ₹44,146 Cr and a P/E Ratio of 19.72. The Dividend/Share is ₹58 and the Promoter’s shareholding is 54.53%. The company’s revenue increased by 17.16% and net profit increased by 30.26% as on 31st December, 2021. The 3 years CAGR Net Profit is 10.72%.
The Ramco Cements
The Ramco Cements Ltd., founded in 1961, is based in Chennai was formerly known as Madras Cements Ltd. and is a part of the well-known Ramco Group of South India. It is the fifth largest cement producer in India. Portland Cement, the main product of the company, is manufactured in five production plants in Southern India. The production capacity is 13 MTPA. The company also produces Dry Mortar Products and Ready Mix Concrete.
Ramco Cements has a market capitalization of ₹17,922,78 Cr and a P/E Ratio of 19.69. The Dividend/Share is ₹3 and the Promoter’s shareholding is 42.33%. The company’s revenue increased by 13.46% and net profit increased by 16.91% in the fiscal year ended 31st March, 2022. The 3 years CAGR Net Profit is 32.64%.
Dalmia Bharat
Dalmia Bharat Ltd., founded in 2013, is a mid-cap cement company. The company’s product portfolio includes Ordinary Portland Cement (OPC), Portland Pozzolana Cement (PPC), Portland Composite Cement (PCC), Portland Slag Cement (PSC), oil well cement, railway sleeper cement, sulphate resisting Portland cement, and special cements for air strips and nuclear power plant construction. The company has several brands such as Dalmia Cement, Dalmia DSP Cement, Konark Cement, Dalmia Infra Green, Dalmia Infra PRO, Dalmia Insta Pro and Dalmia Magic.
Dalmia Bharat has a market capitalization of ₹30,280.65 Cr and a P/E Ratio of 24.18. The Dividend/Share is ₹9 and the Promoter’s shareholding is 55.9%. The company’s revenue increased by 7.26% and net profit decreased by 7% in the fiscal year ended 31st March, 2022. The 3 years CAGR Net Profit is 82.31%.
JK Cement
JK Cement Ltd., founded in 1994, is a mid-cap company which operates in the cement manufacturing and marketing business. The company’s product range includes white cement, grey cement and wall care putty. The installed capacity for grey cement production is 15 MTPA and includes Portland Pozzolana Cement (PPC), Ordinary Portland Cement (OPC), Portland Slag Cement (PSC), JK Super Strong, and JK Super Strong Weather Shield Cement. The company has a white cement capacity of 1.2 MTPA. Besides India, the products are sold in 43 countries in the world.
JK Cement has a market capitalization of ₹20,637.96 Cr and a P/E Ratio of 27.66. The Dividend/Share is ₹15 and the Promoter’s shareholding is 45.84%. The company’s revenue increased by 20.95% and net profit decreased by 3.42% in the fiscal year ended 31st March, 2022. The 3 years CAGR Net Profit is 60.54%.
Birla Corporation
Birla Corporation Ltd., founded in 1919, is a mid-cap company of the M. P. Birla group. The company operates in four different divisions: cement, jute, vinoleum and auto trim division. The company’s cement product portfolio includes Ordinary Portland Cement, Portland Slag Cement, Fly Ash-based Portland Pozzolana Cement, Sulphate Resistant cement, and Low Heat Cement. The company has a strong presence in northern, eastern and central India. The company has acquired 100% shareholding of Reliance Cement which was earlier a part of Reliance Infrastructure Ltd. This has increased its total capacity from 10 MTPA to 15.6 MTPA.
Birla Corporation has a market capitalization of ₹7,496.45 Cr and a P/E Ratio of 22.84. The Dividend/Share is ₹10 and the Promoter’s shareholding is 62.9%. The company’s revenue increased by nearly 10% and net profit decreased by nearly 37% in the fiscal year ended 31st March, 2022. The 3 years CAGR Net Profit is 24.85%.
Heidelberg Cement
Heidelberg Cement India Ltd., entered Indian markets in 2006 by acquiring Mysore Cement and Cochin Cement and a joint venture with Indorama Cement. It has a manufacturing capacity of 14 MTPA. It has four Integrated Cement plants and four Grinding Units. Its products are mainly sold in 12 states across the country. Its major brands are Mycem, Mycem Power and Mycem Primo Cement.
Heidelberg has a market capitalization of ₹4,362.30 Cr and a P/E Ratio of 17.04. The Dividend/Share is ₹9 and the Promoter’s shareholding is 69.39%. The company’s revenue increased by 8.51% and net profit decreased by nearly 20% in the fiscal year ended 31st March, 2022. The 3 years CAGR Net Profit is 6.92%.
India Cements
India Cements Ltd., established in 1946, is the largest cement manufacturer in South India. The company’s ready mix concrete, Ordinary Portland Cement (OPC), and Sulphate Resistant Portland Cement (SRC) which are sold under the brand names Sankar Super Power, Raasi Gold and Coromandel King. OPC is used for building concrete roads, bridges and runways since it is high strength cement. Its blended cements are high durability and are used for plastering and finishing works. SRC products are used for the construction of coastal works, water treatment plants, basements, chemical factories, etc.
India Cements has a market capitalization of ₹6,329.65 Cr and a P/E Ratio of 23.49. The Dividend/Share is ₹1 and the Promoter’s shareholding is 28.42%. The company’s revenue increased by 7.72% and net profit decreased by nearly 69% in the fiscal year ended 31st March, 2022. The 3 years CAGR Net Profit is 61.62%.
Above, we have summarized information regarding the best cement stocks in India. Investing in the best cement stocks for long term will surely lead to capital appreciation and wealth creation.
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