3 “Buy” recommendations from Jefferies; Up to 18% return potential on UltraTech Cement, JK Cement, Can Fin Homes

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Global brokerage Jefferies has maintained its bullish stance on three Indian stocks, issuing “Buy” recommendations with up to 18% upside potential based on strong sector fundamentals, robust earnings outlook, and attractive valuations. The three stocks are UltraTech Cement, JK Cement, and Can Fin Homes, each backed by sector-specific tailwinds and company execution capabilities.

UltraTech Cement: 14% upside potential

Jefferies has set a target price of ₹11,000 for UltraTech Cement, implying nearly 14% upside from its last closing price of ₹9,650. The brokerage highlighted UltraTech’s:

  1. Strong pan-India presence with 150+ MTPA capacity, cementing its leadership position
  2. Ongoing brownfield expansions enhancing market share and economies of scale
  3. Strategic focus on sustainability with 30% green power share and aggressive blended cement sales to reduce costs and emissions

Q1 FY26 Performance Snapshot

Particulars (₹ crore)Q1 FY26Q1 FY25YoY Change (%)
Revenue19,74517,281+14.3
EBITDA3,8973,221+21.0
EBITDA Margin (%)19.718.6+110 bps
Net Profit2,1111,557+35.5

Jefferies noted that UltraTech’s profitability will continue to improve as new capacities ramp up, fuel costs stabilise, and demand remains strong due to infrastructure and housing push.

JK Cement: 18% upside potential

For JK Cement, Jefferies has assigned a target price of ₹4,100, indicating an 18% upside from its current market price of ₹3,475. The brokerage believes JK Cement is well-positioned in the white cement and putty segment with over 40% market share, complemented by steady growth in grey cement capacity.

Growth Drivers

  1. Commissioning of Panna plant in Madhya Pradesh adding 4 MTPA capacity, enhancing its regional presence in central India
  2. Steady improvement in blended cement sales mix supporting margins
  3. Rising demand in real estate and infrastructure driving volume growth

Financial Highlights: Q1 FY26

Particulars (₹ crore)Q1 FY26Q1 FY25YoY Change (%)
Revenue2,9652,512+18.0
EBITDA567462+22.7
EBITDA Margin (%)19.118.4+70 bps
Net Profit312245+27.3

Jefferies highlighted JK Cement’s strong balance sheet and focused expansion strategy, maintaining its “Buy” rating for long-term investors.

Can Fin Homes: 16% upside potential

Jefferies issued a target price of ₹1,070 for Can Fin Homes, implying nearly 16% upside from its current price of ₹925. The brokerage believes the housing finance company will benefit from:

  1. Strong growth in affordable housing demand, especially in tier-2 and tier-3 cities
  2. Stable asset quality with Gross NPA at 0.64%, among the lowest in the sector
  3. Cost of funds advantage due to parentage of Canara Bank and focus on salaried borrower segment

Q1 FY26 Financial Performance

Particulars (₹ crore)Q1 FY26Q1 FY25YoY Change (%)
Net Interest Income310268+15.7
Net Profit201172+16.9
Disbursements2,9982,564+16.9
Gross NPA (%)0.640.65-1 bps

Jefferies noted:

“Can Fin’s prudent underwriting, strong capitalisation, and granular loan book provide earnings visibility with lower credit cost risks compared to peers.”

Analyst Commentary

Jefferies believes these three stocks offer strong risk-reward profiles backed by:

  • Robust sector outlooks (cement and housing finance)
  • Structural growth drivers like infrastructure capex, housing demand, and urbanisation
  • Healthy financials with strong balance sheets supporting expansion and dividend payouts

Stock Market Performance Summary

StockCurrent Price (₹)Target Price (₹)Upside Potential (%)
UltraTech Cement9,65011,000+14.0
JK Cement3,4754,100+18.0
Can Fin Homes9251,070+16.0

Risks Highlighted

Despite the bullish outlook, Jefferies flagged the following risks:

  1. For cement stocks: Increase in fuel or freight costs, slowdown in construction demand, regulatory changes in mining or environment norms
  2. For Can Fin Homes: Competitive pressure on spreads, potential asset quality deterioration if macro conditions weaken

Conclusion

Jefferies’ latest “Buy” recommendations on UltraTech Cement, JK Cement, and Can Fin Homes underline the brokerage’s confidence in India’s infrastructure growth story, housing finance resilience, and corporate execution strength. Investors seeking steady returns with sector diversification may consider these stocks as part of their medium to long-term portfolios, with return potential ranging from 14% to 18% based on Jefferies’ targets.

Disclaimer

This news content is for informational purposes only. It is not intended as investment advice. Readers are advised to consult financial experts before making any business or investment decisions based on this report.

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