Anand Rathi has issued a buy rating on Star Cement with a revised target price of ₹265, down from the earlier target of ₹290. According to the research report dated August 11, 2026, the brokerage maintains its bullish stance on the cement company despite near-term challenges. The recommendation is based on valuing the stock at 11x FY28e EV/EBITDA.
Star Cement's quarterly performance was impacted by assembly elections in key operating regions along with elevated costs and reduced incentives on scheme changes by the Assam Government. As reported by Anand Rathi, the company's near-term performance is likely to remain under pressure due to floods in Assam and continued cost pressure. However, improving FSA coal availability is expected to reduce fuel costs from Q2FY27e.
The management expects volume growth of 8-9% in FY27e, with EBITDA per tonne recovering to ₹1,500-1,600, supported by pent-up demand in H2FY27 and cost-saving initiatives. According to the research report, capacity expansion remains a key long-term growth driver, with the company targeting 18-20 MTPA capacity by FY30. The management has capped peak net debt/EBITDA at 1.5-1.6x.
The revised target price of ₹265 represents a significant reduction from the earlier ₹290 target, indicating potential near-term headwinds despite the positive long-term outlook. As reported by Anand Rathi, the brokerage maintains its buy rating despite the downward revision in target price, suggesting confidence in the company's recovery prospects and strategic initiatives. The stock continues to trade with the brokerage's positive recommendation despite the challenging quarterly performance.
