Leveraging JSW Group’s presence in steel manufacturing, JSW Cement is the largest supplier of ground granulated blast furnace slag in India with ~84% market share in FY25. The product is manufactured from slag, a byproduct of the steel-making process. GGBS accounted for ~34% of JSW Cement’s total revenue in FY25, though we believe that its contribution to Ebitda was higher at ~61%/76% in FY24/FY25.
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Motilal Oswal Report
We initiate coverage on JSW Cement Ltd. with a Neutral rating and a target price of Rs 163, valuing at 15x Sep’27E EV/Ebitda.
Over FY25-28E, we estimate a CAGR of 19%/31% in revenue/Ebitda, led by volume (~12%/19% CAGR for ground granulated blast furnace slag/cement) and pricing growth (~2%/3% CAGR for GGBS/cement).
It should report a profit of ~Rs 3 billion in FY26E (loss of Rs 554 million adjusted for CCPS-related charges in FY25). Return in invested capital should rise to 8.1% in FY28E from 5.7% in FY25.
Key upside risks:
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improvement in C:C ratio for existing plants and higher-thanestimated C: C ratio for the North plant; and
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higher-than-estimated GGBS volumes and higher utilization for the North plant.
Key downside risks:
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declining trade volumes of ~53% in FY25 vs ~65% in FY22;
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pricing pressure in the South region; and
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delay in capacity commissioning in the North or lower utilization there.
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