Domestic brokerage firm Motilal Oswal has upgraded JSW Cement Ltd. from Neutral to Buy rating, citing the company's strong positioning for sustained medium-term growth. According to the brokerage report dated September 18, 2026, the target price has been set at ₹146, implying a potential upside of 25% from the current market price of ₹117. The upgrade was well-received by the market, with JSW Cement shares gaining nearly 2% during the session and touching an intraday high of ₹119.75 on the BSE. The brokerage expects the stabilisation of the North India plant along with internal cost-efficiency initiatives covering alternative fuels and raw materials (AFR), renewable power and logistics to help lower operating costs and support margins.
As reported by Motilal Oswal, JSW Cement is experiencing robust volume growth momentum, with overall volume growth estimated at 23-25% YoY during July-August, including contribution from its North India plant. The brokerage notes that industry volumes grew 10-12% YoY in Jul-Aug'26, with JSWC volume broadly in line with industry on a like-for-like basis, but including the north plant, overall volume growth was 23-25% YoY. The company's approximately 40% GGBS mix also provides relatively lower exposure to fuel-cost inflation, helping cushion near-term margin pressures. This strong volume performance is a key driver supporting the company's medium-term growth outlook and the brokerage's positive rating upgrade.
As reported by Motilal Oswal, the north India plant commissioned in March at Nagaur, Rajasthan, achieved an average utilization of 55% in Q1FY27 and is identified as a key growth driver providing both incremental capacity and access to a more profitable and balanced market. The south India cement market has been grappling with an oversupply situation for a while, which has kept pricing trends muted in this region. In contrast, north and central India have relatively more favourable demand-supply dynamics and better pricing prospects, making the north plant a strategic asset for the company's diversification strategy. The brokerage notes that "North ramp-up strengthens growth outlook" and highlights the potential for stronger volumes and efficiency gains to drive a re-rating in the stock.
According to Motilal Oswal, there will be near-term margin pressure due to higher input costs and weak pricing, which will be faced by all cement players. In Q1FY27, higher power and fuel costs, packaging expenses and elevated operating costs at the Nagaur plant dragged consolidated EBITDA down 7% year-on-year to ₹299 crore. The management expects Q2 costs to remain broadly similar to Q1, with a reduction expected from Q3 onwards. At the North India plant, variable costs per tonne are expected to decline over the next six months as OLBC, AFR and WHRS operations become fully operational. The brokerage estimates that fuel cost is expected to remain broadly flat or rise marginally in 2QFY27, supported by low-cost inventory, while these cost optimization measures are expected to improve the company's competitive position in the market.
According to Motilal Oswal, the brokerage estimates a CAGR of ~20%/20%/15% in revenue/EBITDA/PAT over FY26-28. The JSW Cement stock has declined about 20% from its initial public offering issue price of ₹147 in August 2025. JSW expects volume growth in the high teens in FY27, but costs are identified as a near-term re-rating trigger. At the current market price, the stock is trading at 12x FY28E EV/EBITDA compared to 14x FY28E EV/EBITDA at its listing price. Motilal Oswal values the company at 14 times FY28E EV/EBITDA to arrive at the target price of ₹146. The valuation reflects the company's improved operational metrics, strong volume growth momentum, and strategic positioning in the cement industry, with revenue, EBITDA and PAT expected to grow at a strong pace supported by the transition into a more diversified, integrated and geographically balanced business model.
