India Cements (INDIACEM)
CyclicalFairStock Score: 50/100 — MIXED
Score breakdown: P/E: 0/3 · ROCE: 0/2 · Growth: 2/2 · Dividend: 0/1
Key Financials
| Current Price | ₹375.3 |
| Market Cap | ₹17,445.64 Cr |
| P/E Ratio | 125.1 |
| ROCE | -5.49% |
| ROE | -1.1% |
| Dividend Yield | 0% |
| Profit Growth | 102.69% |
| Debt/Equity | 0.13 |
| Sales Growth | -0.5% |
| Free Cash Flow | ₹1,759 Cr |
| Promoter Holding | 75% |
| 52-Week Range | ₹342.35 — ₹485.8 |
| Sector | Cement & Cement Products |
| Book Value | ₹326.7 |
Strengths
- Low debt/equity of 0.13 provides financial cushion
- Positive free cash flow of ₹1,759 Cr supports balance sheet
- Promoter holding of 75% aligns interests with minority shareholders
- Trading near book value at 1.29 times with book value of ₹328.95
- Latest sales growth of 5.42% shows some momentum
Concerns
- ROE of -1.10% and ROCE of -5.49% indicate value destruction
- EV/EBITDA of 220.40 is extremely high for weak current earnings
- Altman Z-score of 1.65 suggests financial stress risk
- 5-year revenue CAGR of -1.66% and zero dividend yield limit shareholder returns
AI Analysis
India Cements is a business I can understand, but understanding does not make it attractive. At ₹424.10, the market cap is ₹12,582 Cr, roughly 1.29 times book value of ₹328.95. Graham taught me to treat book value only as a starting point; what matters is earning power. Right now, earning power is missing. Last quarter, on sales of ₹1,114 Cr, the company lost ₹3 Cr. ROE is -1.10% and ROCE is -5.49%, meaning it is destroying value, not creating it. The reported profit growth of 102.69% sounds impressive, but that is from a loss-making base. Five-year revenue CAGR is -1.66%, so the franchise has not grown, although the latest quarter shows 5.42% sales growth. The balance sheet is a plus: debt/equity is only 0.13, and reported free cash flow is ₹1,759 Cr. Promoter holding of 75% also aligns owners and management. However, the market is paying an extraordinary 220.4 times EV/EBITDA for a business earning poor returns. The Altman Z-score of 1.65 is a yellow flag, and with zero dividend yield, shareholders receive no cash while waiting. The DCF value of ₹3,037.60 is tempting, but I treat it skeptically because a model built on depressed or unstable earnings can produce misleading comfort. Cement is a cyclical commodity business; this looks like a cyclical asset play with turnaround potential. As a value investor, I need margin of safety. At this price, with negative returns and uncertain recovery, I would wait for proof of sustained profitability and better returns on capital before investing.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer