INDIACEM - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

🧠 My Thought Process

You're asking for a full-spectrum fundamental analysis of India Cements Ltd (INDIACEM), with a numeric rating and strategic investment guidance. I’ve weighed profitability, capital efficiency, valuation, and business durability, and factored in recent developments including its strategic alignment with UltraTech Cement

1

.

📊 Fundamental Analysis of India Cements Ltd

🔍 Core Financials

Profitability

PAT Qtr: -₹13.8 Cr vs -₹73.0 Cr — losses narrowing, but still negative.

EPS: -₹24.5 — indicates continued earnings pressure.

ROE: -9.32%, ROCE: -5.85% — poor capital efficiency, reflecting operational inefficiencies.

Leverage & Liquidity

Debt-to-equity: 0.12 — low leverage, which is a positive.

Dividend Yield: 0.00% — no payouts, reinvestment-focused.

Cash Flow & Stability

Recent asset sales and capital restructuring have improved the balance sheet

1

.

UltraTech Cement’s ₹1,500 Cr capex plan for India Cements is expected to address legacy inefficiencies and improve plant productivity

1

.

📉 Valuation Indicators

Metric Value Interpretation

P/E Ratio N/A Not meaningful due to negative earnings

P/B Ratio ~1.28 Reasonable given book value of ₹311 vs price of ₹399

PEG Ratio N/A Not applicable due to negative EPS

Intrinsic Value ~₹360–₹380 Slightly below current price — limited upside

🧱 Business Model & Competitive Edge

Segment Focus: Cement manufacturing with 14.45 MTPA capacity, mostly in South India.

Moat: Strong brand presence and strategic importance to UltraTech Cement.

Growth Drivers

Operational synergies from UltraTech’s ownership and management.

Potential turnaround via capex and restructuring.

Historical 5-year return of 169.6% suggests speculative upside

2

.

📈 Technical & Entry Guidance

Current Price: ₹399

DMA 50/200: ₹375 / ₹338 — bullish crossover.

RSI: 58.5 — neutral to mildly bullish.

MACD: 8.36 — positive momentum.

🎯 Entry Zone

Ideal Buy Range: ₹370–₹385 — near DMA support.

Stop Loss: ₹355

Target: ₹420–₹440 in medium term

2

🕰️ Long-Term Holding Outlook

Hold if invested: Strategic backing from UltraTech and restructuring efforts support cautious optimism.

Buy on dips: Preferably near ₹380 zone.

Growth Triggers: Capex execution, operational turnaround, and cement demand recovery.

⭐ Fundamental Rating

3.4

1

www.careratings.com

2

stockpricearchive.com

Edit in a page