Which are the best cement stocks in India? Today, in this article we will check various cement stocks and find out which one is the best cement stock in India. We will check the top cement companies based on their market capitalization, PE ratio, ROCE, and many other factors.
Before we move ahead, let’s first finalized these companies based on their market capitalization. Here we are going to pick only the top companies based on their market capitalization. Below is the list of the shortlisted companies.
| Company Name | Market Cap | PE Ratio | ROCE |
|---|---|---|---|
| Shree Cement | 99699 | 43.62 | 19.40 |
| UltraTech Cement | 190278 | 34.83 | 15.72 |
| Ambuja Cement | 64457 | 22.56 | 18.29 |
| ACC Cement | 37195 | 20.70 | 15.97 |
| J K Cement | 21697 | 33 | 17.09 |
Based on the market capitalization, UltraTech cement is the biggest cement company in India with M. Cap of ₹ 190278 Crs. Second, in the list is the Shree Cement with M. Cap of ₹ 99699 Crs.
Now let’s check their PE ratio which is one of the main parameters for shortlisting the best cement company in India. If you look at the PE of these companies, you will find that the PE ratio of Ultratech cement is the lowest as of date. Lower the PE, better it is for the buying opportunity.
Another major parameter we will check here is the Return On Capital Employed (ROCE). This ratio tells us the return earned by the company on the capital invested in the company. This is basically an output of the capital invested in the business. This parameter will tell us how efficient the company is using the capital.
Shree Cement has the highest ROCE of 19.40, so we can say that the company is using the capital efficiently.
Now let’s check the debt to equity ratio of these companies.
| Shree Cement | 0.12 |
| UltraTech Cement | 0.40 |
| Ambuja Cement | 0.00 |
| J K Cement | 1.00 |
| ACC Cement | 0.01 |
By looking at the debt to equity ratio, it is coming out that Ambuja cement is a cement company with zero debt on its back.
Moving forward, let’s check the interest coverage ratio for these companies.
| Shree Cement | 13.0 |
| UltraTech Cement | 6.56 |
| Ambuja Cement | 35.8 |
| ACC Cement | 38.5 |
| J K Cement | 4.83 |
ACC cement is the best with interest coverage ratio of 38.5 followed by Ambuja cement at 35.8.
Now let’s check the promoter’s holdings in the companies.
| Shree Cement | 62.6% |
| UltraTech Cement | 60.0% |
| Ambuja Cement | 63.3% |
| ACC Cement | 54.5% |
| J K Cement | 57.6% |
Again the Ambuja Cement is the best in terms of the promoter’s holdings. In the second position, we have Shree Cement with 62.6%.
Companies’ valuation is based on these parameters like ROCE, PE ratio, debt to equity ratio, etc. These parameters will help us to identify the best company from the crowd.
Looking at the above parameters, we can conclude that Ambuja Cement is the best cement stock in India.All the parameters and factors are in favour of the company.
