SHREECEM - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Investment Rating: 3.6

📊 Long-Term Investment Analysis

Shree Cement (SHREECEM) is a large-cap cement company with a strong brand and operational footprint. However, its current valuation and financial metrics raise caution for long-term investors.

✅ Positives

Low Debt: Debt-to-equity ratio of 0.05 indicates excellent financial discipline.

Promoter Holding: Stable at 62.55%, showing long-term commitment.

EPS: Strong at ₹311, reflecting solid earnings per share.

Price Momentum: Trading near 52-week highs, with long-term bullish trend intact

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Forecasted Growth: Price targets suggest potential upside to ₹56,000–₹78,000 by 2027

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⚠️ Concerns

Valuation: P/E of 98.2 is nearly double the industry average (51.1), indicating significant overvaluation

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ROE & ROCE: Weak at 5.29% and 6.71%, below industry standards.

PEG Ratio: Negative at -4.55, suggesting poor earnings growth relative to valuation.

Dividend Yield: Low at 0.36%, not attractive for income investors.

Quarterly Volatility: Profit variation of -14.9% signals inconsistent performance.

💰 Ideal Entry Price Zone

Based on valuation and technical indicators

Intrinsic Value Estimate: ₹26,000–₹28,000

Current Price: ₹30,410

DMA 50/200: ₹30,616 / ₹28,819

Suggested Entry Zone: ₹27,000–₹28,500 This range offers a better margin of safety and aligns with fair value estimates

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🧭 Exit Strategy & Holding Period

📈 Holding Strategy

Time Horizon: 3–5 years to benefit from infrastructure growth and premium cement demand.

Growth Targets

2025: ₹36,000–₹40,000

2026: ₹42,000–₹56,000

2030: ₹88,000–₹90,000

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🚪 Exit Strategy

Partial Exit: If price exceeds ₹40,000 by 2025–2026 without improvement in ROE/ROCE.

Trailing Stop: Use a stop-loss below ₹29,000 if price momentum weakens.

Re-evaluate: If PEG remains negative and ROE stays below 7%, consider switching to better-performing peers like Ultratech or Ambuja.

Would you like a side-by-side comparison with other cement stocks to identify better long-term value?

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stockpricearchive.com

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dailybulls.in

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stockanalysis.com

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www.valueresearchonline.com

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