Cement demand in India continues to expand. According to ICRA, cement volumes are expected to grow 6–7% in the near term. This is supported by sustained infrastructure spending and steady housing activity. Demand recovery is now visible across regions.
To meet this demand, cement companies are increasing capacity. ICRA estimates that the industry will add around 85–90 million tonnes per annum of capacity over the next two years. Most of this expansion is through brownfield projects and grinding units. Both large incumbents and regional players are participating in this cycle.
However, rising demand and capacity additions do not automatically translate into higher shareholder returns. The key question is how much of this growth converts into earnings. Balance sheet strength, margin stability and return ratios matter.
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Valuations also need to be assessed against a company’s own history rather than the sector narrative alone.
Against this backdrop, the stocks selected in this article reflect how unevenly the market is pricing capacity expansion. Large incumbents with scale and a long execution record already trade at valuations that factor in smooth capacity additions and stable margins.
Some others, despite visible expansion plans and manageable balance sheets, continue to trade closer to historical valuation levels as the market waits for earnings and utilisation gains to come through. Together, these names highlight the gap between expansion visibility and how much of it is already reflected in stock prices.
#1 UltraTech Cement
UltraTech Cement is engaged in the manufacturing and sale of Cement and Cement related product primarily across the globe.
UltraTech Cement turned in a solid performance in the December 2025 quarter as volumes stayed strong and operating leverage kicked in.
Consolidated sales volumes increased 15% year on year (YoY) to 38.9 million tonnes. Domestic grey cement volumes grew 15.4%. Revenue rose 22.5% to Rs 21,506 crore. Adjusted net profit climbed 32% to Rs 1,792 crore, after excluding the impact of labour code changes.
Capacity additions continued during the quarter. Domestic grey cement capacity stood at 188.7 million tonnes per annum (MTPA). During the period, UltraTech commissioned 1.8 MTPA and capacity utilisation improved to 77%. This points to steady demand absorption.
Valuations, however, appear to have factored in all the good news. The stock trades at about 24.7 times EV/EBITDA, in line with its three-year median of 23.9 times. ROCE stands at 10.9%.
From here, gains are expected to depend more on margins and cost control rather than fresh capacity additions.
In the past year, UltraTech Cement share price is up 9.4%.
UltraTech Cement 1-Year Share Price Chart
#2 ACC
ACC is a member of the Adani Group, is principally engaged in the business of manufacturing and selling of Cement and Ready Mix Concrete. The Company has manufacturing facilities across India and caters mainly to the domestic market.
ACC had a strong September 2025 quarter, driven mainly by higher volumes and tighter cost control. The company is yet to declare Q3 results.
Cement volumes increased 20% from a year ago to 9.9 million tonnes. Revenue from operations rose 22% to Rs 5,149 crore. Net profit climbed 177% to Rs 1,388 crore, helped by operating leverage and lower input costs.
EBITDA per tonne stood at Rs 1,060 for the period, helped by ongoing efficiency initiatives. Cost savings across operations continued to support margins.
ACC has revised its FY28 capacity target to 155 MTPA, up from 140 MTPA earlier. The expansion will mainly be through brownfield projects and grinding units. This is expected to support quicker execution and lower capital requirements.
Changes following the company’s integration with the Adani Group are starting to reflect in operations. Benefits are visible in logistics optimisation, fuel sourcing and an improved mix of premium products. Even so, valuations remain subdued.
ACC is trading at about 6.7 times EV/EBITDA, well below its three-year median of 12.2 times. ROCE stands at 17.4%. This suggests the market is still cautious and is looking for sustained earnings delivery before pricing in the full benefits of expansion.
In the past year, ACC share price tumbled 18.5%.
ACC 1-Year Share Price Chart
#3 JK Cement
JK Cement is engaged in the manufacturing and selling of Cement and Cement related products with over 4 decades of experience in cement manufacturing. JK Cement operates under the JK Organisation group.
It delivered a stable December 2025 quarter, helped by better volumes and ongoing capacity additions. Consolidated revenue rose 20% to Rs 3,383 crore. Profit for the quarter was affected by a one-time labour code provision, though operating performance remained stable. Net profit for Q3 FY26 stood at Rs 174 crore lower than Rs 190 crore reported a year ago.
Capacity expansion continued during the period. The company has commissioned several units under its 6 million tonne brownfield expansion in Central India. This includes clinker and grinding capacity at Panna, Hamirpur and Prayagraj.
The Buxar grinding unit is expected to be commissioned shortly. JK Cement is also executing a greenfield integrated plant at Jaisalmer, which is targeted for commissioning by September 2027.
Management expects cement demand to grow 6–7% in the near term. JK Cement aims to grow volumes faster than the industry. While expansion plans are clearly visible, execution discipline and balance sheet control will be key as capital expenditure rises over the next few years.
JK Cement trades near 18.1 times EV/EBITDA, compared with a three-year median of 19.2 times. ROCE stands at 14%. This suggests that while expansion visibility is strong, the market is yet to fully price in execution and earnings delivery, keeping the focus on project completion and balance sheet discipline.
In the past year, JK Cements share price surged 16.7%.
JK Cements 1-Year Share Price Chart
#4 Nuvoco Vistas Corporation
Nuvoco Vistas Corporation (NVCL) is one of the largest cement companies and concrete manufacturers in India. It offers a diversified range of products such as cement, Ready-mix Concrete (RMX), and modern building materials such as adhesives, wall putty, dry plaster, cover blocks, and more.
Nuvoco Vistas reported a better December 2025 quarter. Demand improved towards the end of the period. Cement volumes rose 7% year on year to 5 million tonnes, the highest ever for a third quarter.
December volumes were up 20%, showing a clear pickup in offtake. Revenue for Q3 FY26 grew 12.1% YoY to Rs 2,701 crore. Net profit for the quarter stood at Rs 49 crore which marks a turnaround from a loss of Rs 61 crore reported in the last year.
Capacity expansion remains a key part of the company’s strategy.
Development at the Vadraj cement project is progressing in stages. Commissioning of clinker and grinding units is planned between Q3 FY27 and Q1 FY28. Alongside this, the eastern India expansion of 4 million tonnes per annum is on track. Once these projects are completed, Nuvoco’s cement capacity will increase to about 35 million tonnes per annum.
The company is trying to lift realisations by selling more premium products and using digital tools to reach customers.
Valuations, however, remain on the lower side. Nuvoco is trading at around 9.8 times EV/EBITDA, compared with its three-year median of 12 times. ROCE is at 3.9%. This shows that the market is still waiting to see steady improvement in earnings and a stronger balance sheet before taking a more positive view on the expansion cycle.
In the past year, Nuvoco Vistas Corporation share price is down 1.8%.
Nuvoco Vistas Corporation 1-Year Share Price Chart
Valuations
Let us now look at how the selected cement stocks are valued, using EV/EBITDA as the main reference.
Valuations of Companies in focus
| Sr No | Company | EV/EBITDA Ratio | Industry Median | ROCE |
| 1 | Ultratech Cement | 24.7 | 12.3 | 10.9% |
| 2 | ACC | 6.7 | 17.4% | |
| 3 | JK Cement | 18.1 | 14.0% | |
| 4 | Nuvoco Vistas | 9.8 | 3.9% |
Valuations across these companies show a wide gap. UltraTech Cement continues to trade at a clear premium to the industry median, reflecting its scale and strong execution record.
ACC is trading at much lower levels despite better return ratios. JK Cement is valued closer to average cycle levels. Nuvoco Vistas remains at the lower end of the range, in line with its weaker return profile.
This indicates that the market is taking a selective view on the sector. Companies with stable operations and better earnings visibility are being rewarded with higher multiples. Others, where expansion is still in progress or returns are under pressure, are being valued more cautiously.
While demand trends and capacity additions remain supportive, investors need to consider how much of the future growth is already reflected in current prices. The key question is whether utilisation and margins will improve enough to justify these valuations, or whether earnings will need to strengthen further before any meaningful re-rating takes place.
Conclusion
Overall, cement companies are clearly in the middle of an expansion phase. Demand conditions remain favourable and new capacities are being added across regions. But the way stocks are priced suggests the market is taking a selective view.
Larger companies with scale and a proven execution record are already valued on the assumption that expansion will go as planned. Some stocks continue to trade close to earlier valuation levels even after adding capacity. Investors appear to be waiting for higher utilisation and consistent earnings before revising their position.
At this stage, capacity addition by itself may not be enough to move stock prices meaningfully. Going ahead, execution and financial performance will matter more. Margins, debt levels and profit conversion will be closely monitored.
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 into the world of companies, studying their performance, and uncovering insights that bring value to her readers.
Disclosure: The writer and his dependents do not hold the stocks discussed in this article.
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