The cement sector is acquiring growing prominence in India’s economic narrative. With infrastructure creation, urbanization, and residential projects accelerating, cement finds itself a crucial component in India’s growth story. Large-scale initiatives by the government such as PM Awas Yojana and Gati Shakti propelling construction within cities and towns are pushing cement demand steadily upwards.
After a disappointing start to FY25, larger cement firms saw robust volume growth in the fourth quarter of FY25. Is is expected that the momentum will continue into FY26 on the back of good demand from both public and private sector projects. There are several big players which believe they can maintain this growth due to constant infrastructure outlays and an increase in rural construction.
Another analysis estimates the cement industry to expand at 6–7% annually in FY25–26. The expansion is due to rising government capital spending, an infrastructure drive ahead of elections, and enhancing demand from housing. This places cement firms well-placed to ride the boom.
Industry news also points out that the growth in volumes that was seen during Q4 FY25 is also expected to follow through. The company leaders anticipate the next fiscal year also to be strong, particularly with higher construction activity and firm pricing conditions favouring margins.
With this optimistic outlook, it is essential to examine cement stocks in FY26 closely. We cover five top cement companies here based on their market capitalization. With demand picking up steam, these large cement companies are positioned well to ride the growth and potentially reward investors.
#1 UltraTech Cement
UltraTech Cement is engaged in the manufacture and sale of cement and cement related product primarily across globe.
UltraTech Cement is in a phase of robust growth, sustained by expansion, acquisitions, and strengthening of operations. With the acquisition of Kesoram and India Cements, its capacity has grown to 184 million tons and will soon come close to 212 million tons.
These assets are already helping drive volume growth and improved margins, with India Cements already at EBITDA breakeven and solid sales soon after the acquisition.
The company is planning large capex in FY26 to pursue waste heat recovery, renewable energy, and cost-saving initiatives that would begin yielding benefits from FY27. Although the scale of investment, UltraTech has a comfortable debt profile underpinned by growing EBITDA.
With housing and infrastructure demand running strong, its strategy of scaling, integrating, and optimizing puts it in place to dominate the cement industry’s next growth cycle.
UltraTech Cement Financial Performance Summary (FY21-25)
UltraTech Cement has posted a robust and consistent increase in revenue over the last five years with sales increasing from Rs 44,726 crore in FY2021 to Rs 75,955 crore in FY25—a healthy compounded annual growth rate (CAGR) of 12%. Operating profits have been consistent, although mildly oscillating, reaching ₹12,969 crore in FY2024 before easing a bit in FY25.
Net profit performance has been less consistent, increasing in FY22 and FY24 but falling in FY2023 and FY2025, and generating a moderate profit CAGR of only 1% during the five-year period.
While there is volatility in profits, the business has continued a stable and steadily increasing dividend pay-out, from 20% in FY2021 to 38% in FY2025. This reflects UltraTech’s dedication to shareholders’ returns, even in the years of soft profit growth.
Having earned an average return on equity of 12% during the period, the financial picture demonstrates strength and a commitment to returning value.
Yet, it must be pointed out that on 21 May 2025, the Aditya Birla group firm is quoted at an elevated price/earnings (P/E) multiple of 56.2 times. It is well above its 10-year median multiple of 38 times.
#2 Ambuja Cements
Ambuja Cements is among the leading cement companies in India. It is a member of the Adani Group. Currently, Ambuja Cement has a cement capacity of more than 100 million tonnes per annum (MTPA) with six integrated cement manufacturing plants and eight cement grinding units across the country.
Ambuja Cements is poised for a high-growth path with a vision of reaching 140 million tons capacity by FY28, from more than 100 MTPA today. This would be led by organic growth in various locations like Bhatapara, Maratha, and Jodhpur, as well as through enhanced efficiencies through cost savings, WHRS upscaling, and digitalization.
The firm has a clear roadmap to drive cost of operations to Rs 3,650 a ton by FY28, and huge strides have already been made. With robust cash flows, group synergies, and a tech-savvy, young leadership team, Ambuja is well poised to continue expanding margins and outgrow the industry.
It also remains committed to growing premium products and enhancing logistics. With these actions, Ambuja is looking to drive steady volume growth and strong profitability in the years to come.
Ambuja Cements Financial Performance Summary (FY21-25)
Ambuja Cements has delivered strong financial performance in recent years, while going through a change in its reporting period after the Adani Group buyout. The company shifted from calendar year to fiscal year format, with the long 15-month transition period ending March 2023 acting as a bridging period between the two.
The firm posted a smooth financial journey, with sales increasing from Rs 13,979 crore in December 2021 to Rs 19,454 crore in March 2025, with an 11% CAGR. Net profit, though irregular in the meantime, picked up strongly in FY25, taking the aggregate profit CAGR to 20% for the period. Operating profits were fairly consistent, trending around the Rs 3,000 crore level.
Return on equity was 9% on average, which shows moderate capital efficiency. The dividend payout has decreased considerably, however, plummeting from 60% in Dec 2021 to merely 13% in FY25—reflecting a turn of attitude from shareholder remittances to reinvestment and long-term expansion.
It should be noted that Ambuja Cements is quoted at P/E ratio of 33.4 times as on 21 May 2025 which is higher than its 10-year median P/E ratio of 27.3 times.
#3 Shree Cement
Shree Cement is engaged in manufacturing and selling of cement and cement related products and is one of the lowest cost producersin the country. It is the 3rd largest cement producer in India.
Shree Cement is driving growth led by profitability, supported by well-timed capacity addition, premium branding, and operating efficiency. During FY25, the company reported robust numbers, with EBITDA increasing 47% and per-ton profitability enhanced on account of improved price realization, sale of premium products, and reduced energy cost.
Its cement production capacity is currently 62.8 million tons, with two new facilities to be commissioned in early FY26. It aims for more than 80 million tons by 2028. Green power currently supplies 60.2% of its power requirements, with additional solar capacity commissioned and more in the pipeline.
The management has reconfirmed the strategy of pursuing margins over volume, to become the most profitable cement player by delivering strong branding, disciplined costs, and astute market positioning.
Shree Cement Financial Performance Summary (FY21-25)
Shree Cement’s financial record over the last five years indicates uneven performance. While sales have increased at a modest 8% CAGR to Rs 19,283 crore in FY25, both operating and net profits have vacillated wildly.
Net profit declined steeply from Rs 2,337 crore in FY22 to ₹1,124 crore in FY25, reflecting profitability concerns in spite of increasing revenue.
Return on equity averaged 10%, but even that shows volatility and not sustained value creation. The only consistent trend has been the increasing dividend payout by the company, which rose from 9% in FY21 to 35% in FY2025.
Shree Cement is at P/E ratio of 101.2 on 21 May 2025 which is significantly higher than its 10-year median P/E ratio of 49.4 times.
#4 JK Cements
JK Cements is engaged in the manufacturing and selling of cement and cement related products with over 4 decades of experience in cement manufacturing. It is an affiliate of the multi-disciplinary industrial conglomerate JK Organisation.
JK Cement is going into FY26 on a solid footing and with a definite blueprint for capacity growth and product diversification. With grey cement capacity likely to increase through current projects at Panna, Hamirpur, Prayagraj, and Bihar, the company will be well on its way to substantially improving its presence by the end of 2025.
Even as demand was subdued in the first half of FY25, JK Cement recorded a stellar turnaround in Q3 on the back of better realizations and a high proportion of premium products accounting for 16% of trade sales. The company’s renewable energy portfolio is also scaling up, with 11 MW of green power being commissioned in Q3 alone.
With healthy commissioning pace, premiumization focus, and cost-improvement, JK Cement is setting itself up for better earnings and margin growth in FY26 and onward.
JK Cements Financial Performance Summary (FY21-24)
JK Cement’s four-year financial record indicates stable topline growth but a volatile bottom line. Topline has expanded at a whopping 15% CAGR, going up progressively from FY21’s Rs 6,606 crore to FY24’s Rs 11,556 crore. Operating profit, however, declined during FY21 and FY23 before rebounding significantly in FY24.
Net profit has been fluctuating—declining from Rs 703 crore in FY2021 to a trough of Rs 416 crore in FY23 before doubling to Rs 790 crore in FY2024. Profit in the last four years increased at a modest CAGR of 3% Dividend payments have oscillated between 16–27%, with no obvious upward policy—more tactical than strategic. On a whole, the expansion is genuine, but the ride has not been smooth.
JK Cement is trading at P/E multiple of 62.9 times which is very high compared to its 10-year median P/E multiple of 35.3 times.
#5 Dalmia Bharat
Dalmia Bharat is engaged in the business of manufacturing and selling of cement. The company was started in 1939 and is the 4th largest cement manufacturer by installed capacity in India.
Dalmia Bharat is stepping into FY26 with a sharp thrust on cost optimization, capacity growth, and profitable growth. Dalmia Bharat ended FY25 with 49.5 million tons of capacity and has also announced 6 million tons of new expansions in Belgaum and Pune, which will be completed by FY27.
To improve margins, Dalmia is planning for a Rs 150–200 per ton cost savings over a two-year period through improved use of renewable energy, logistics optimization, and more effective heat rate management. Fifty percent of these benefits are envisioned in FY26 itself.
Premium product sales and brand repositioning are also being given emphasis by the company to build market presence. Supported by low net debt (0.3x EBITDA), strong execution, and disciplined growth, Dalmia Bharat is well poised for volume and margin expansion in the next few years.
Dalmia Bharat Financial Performance Summary (FY21-25)
Dalmia Bharat’s five-year financial record shows a mixed picture. Sales have increased at a reasonable CAGR of 8%, from ₹10,110 crore in FY21 to ₹13,980 crore in FY25. But operating profit has been stagnant, with FY25 figures nearly at the same level as FY2021, showing no operating leverage over the years.
Net profit has in fact contracted from ₹1,183 crore in FY2021 to ₹699 crore in FY25, highlighting earnings stress. Return on equity has remained an average of a mere 6%, demonstrating poor capital efficiency over the period.
The sole steady pattern of increase is in dividend payments, which increased from 2% in FY21 to 25% in FY25. But the growing largesse looks more like an effort to sustain investor confidence rather than the result of sound financials.
Dalmia Bharat is also quoting higher than its 10-year median P/E multiple of 35.6 times. Currently, as of 21 May 2025, it is quoting at a multiple of 50.4 times.
Conclusion
While the cement industry sits on the threshold of potential, fueled by increasing infrastructure investments and urbanization, it’s apparent that not all will have the same ability to ride this wave. Quite a few firms have aggressive capacity expansion plans and are intensifying their priority on cost efficiency, premium offerings, and green power. But closer examination of their financial performance suggests inconsistencies—volatile profits, stagnant operating margins, and falling returns in some instances.
Investor optimism has also driven valuations way beyond the norms, rendering price levels today challenging. Overall high P/E ratios indicate that much of the optimism is already factored in. Furthermore, an explosion in demand does not necessarily lead to sustained profitability, particularly in an industry where price is very much in a volatile range and cost pressures are still there.
In summary, although the medium-term demand prospects for cement are promising, investors need to have a complete perspective. Expansion plans, operating discipline, and capital efficiency are just as important as growth headlines. A rising tide will lift the industry, but it will not lift every stock equally. Proper scrutiny is needed before making any investment.
Note: We have relied on data from www.Screener.in throughout this article. Only in cases where the data was not available, have we used an alternate, but widely used and accepted source of information.
The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.
Ekta Sonecha Desai has a passion for writing and a deep interest in the equity markets. Combined with an analytical approach, she likes to deep deep into the world of companies, studying their performance, and uncovering insights that bring value to her readers.
Disclaimer The writer and his dependents do not hold the stocks discussed in this article.
The website managers, its employee(s), and contributors/writers/authors of articles have or may have an outstanding buy or sell position or holding in the securities, options on securities or other related investments of issuers and/or companies discussed therein. The content of the articles and the interpretation of data are solely the personal views of the contributors/ writers/authors. Investors must make their own investment decisions based on their specific objectives, resources and only after consulting such independent advisors as may be necessary.