Target: ₹265
Current Market Price (CMP): ₹274.65
We had a discussion with Tushar Bhajanka, Deputy Managing Director of Star Cement, to gain insights into the company’s growth initiatives and the demand-supply dynamics in the Northeast region.
Key insights include: The Northeast continues to be one of the fastest-growing cement consumption areas, projecting a medium-term CAGR of approximately 10 percent driven by infrastructure investments from Central and State governments; With planned capacity expansions, Star aims to solidify its leadership in the Northeast, beyond its current market share of around 27 percent; The unlikely emergence of new competitors in the Northeast over the next four years is expected to positively influence cement prices; Star is also looking to diversify geographically, with definitive expansion plans in Rajasthan, having already acquired limestone mines in the state through government auctions; The company is on course to achieve a production capacity of around 18 million tons per annum (mtpa), compared to the current capacity of 8 mtpa, in the medium term; furthermore, it remains focused on enhancing cost efficiency through capital expenditures on performance metrics.
We appreciate Star’s regional dominance and its efforts to extend leadership over competitors in the Northeastern market. Additionally, its expansion into Rajasthan will help it transition from being perceived as a regional player to establishing a presence in North India, effectively more than doubling its current capacity. However, we observe that the recent climb in the stock price (over a 30 percent increase in the past two months) may limit short-term gains. We retain our BUY recommendation and our earnings forecasts, with a target price of ₹265.
Published on September 15, 2025
