Ramco Cements share price hits 52-week high, up 47% this year; is it still buy-worthy? Experts weigh in

Ramco Cements share price rose almost 2 per cent to hit its fresh 52-week high of ₹1,049.15 in intraday trade on BSE on Tuesday, December 5. However, the stock erased all gains and slipped about a per cent even as the market benchmarks traded higher.

Ramco Cements share price opened at ₹1,038.95 against the previous close of ₹1,030.15 and rose to the day's high (also 52-week high) and low of ₹1,049.15 and ₹1,019.25, respectively. Around 12:20 hours, the stock traded 0.84 per cent lower at ₹1,021.50 on the BSE.

Year-to-date (as of December 4 closing), the stock is up 47 per cent. The stock hit its 52-week low of ₹636.15 on January 30, 2023. As per the last traded price, the stock has gained 62 per cent from its 52-week low level.

The fundamentals of the stock look healthy, hinting at the possibility for the stock to rise further in the near future.

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Brokerage firm Anand Rathi Share and Stock Brokers has a buy call on the stock and it recently raised the stock's 12-month target price to ₹1,222 from ₹1,007 earlier.

The brokerage firm pointed out that Ramco Cements continues to strengthen its position in its operating regions, the South and the East, through acquiring limestone reserves and entering micro-markets. Moreover, the greater emphasis on a greater share of green energy, cost-efficient capex, and land monetisation to fund expansions are positives, Anand Rathi said.

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"While cost-saving levers are in place to improve operating efficiency, land monetisation is on the cards to fund expansions. We expect 13 per cent, 13 per cent and 27 per cent volume, revenue and EBITDA CAGR, respectively, over FY23-26. We introduce FY26E and retain our buy rating, at a 12-month target price of ₹1,222, 14.5 times FY26E EV/EBITDA," said Anand Rathi.

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Pravesh Gour, Senior Technical Analyst at Swastika Investmart observed that the counter has witnessed a breakout of a cup and handle formations on the weekly chart with huge volume. It has retested its previous breakout level at around ₹955 and started a new leg of rally towards ₹1,200. Moreover, on the daily chart, the stock has broken out of a triangle formation.

"The overall structure of the counter looks lucrative for long-term investment as it is trading above its important moving averages (50, 100, and 200-DMA). The momentum indicator RSI (relative strength index) is also positively poised, whereas MACD (moving average convergence divergence) supports the current strength," said Gour.

"On the higher side, the stock has a trendline resistance at around ₹1,055. Above this level, we can expect a big rally towards ₹1,200, while on the lower side, ₹950 will act as an important support at any correction in the market," Gour said.

While the long-term prospects of the stock look attractive, analysts appear positive about the stock even for the short term.

Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers underscored that since the start of 2023, this stock has been making higher highs and higher lows, which is a sign of a well-established bull trend.

At the current juncture, it has reversed from its previous swing high and is sustaining above it. So, according to Patel, one can hold or add fresh longs and wait for the target of ₹1,200 and a stop loss of ₹950 on a daily closing basis.

However, there is a bearish alternate bat pattern reversal zone near ₹1,200, so one needs to be cautious between the ₹1,175–1,200 zone and keep booking profits, Patel said.

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Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.