Shares of JSW Cement stumbled on their first day of trading Thursday, sliding more than 5% from their opening price and erasing early gains that had topped grey-market expectations, in a muted debut for the Rs 3,600-crore offering.
Solid IPO demand, muted pop
What should investors do?
Analyst views and valuation
Company details and use of proceeds
The stock listed at Rs 153 on the BSE, 4.1% above its IPO price of Rs 147, and at Rs 153.50 on the NSE, a 4.4% premium. But momentum quickly faded, with shares dropping to an intraday low of Rs 145.05 on both exchanges, down 5.2% and 5.5% respectively from their opening levels.
The performance nonetheless beat the grey market premium of Rs 151 seen ahead of listing, which had implied a gain of around 3%.
Solid IPO demand, muted pop
JSW Cement’s book-built IPO, which ran from August 7 to 11, drew 7.77 times subscription overall, fuelled largely by institutional demand. Qualified institutional buyers bid 15.80 times their quota, non-institutional investors 10.97 times, and retail investors 1.81 times. The allotments were finalised on August 12.
The issue comprised a Rs 1,600-crore fresh sale of 10.88 crore shares and an Rs 2,000-crore offer for sale of 13.61 crore shares by promoters. Ahead of the launch, the company raised Rs 1,080 crore from anchor investors, including marquee domestic and global institutions.
What should investors do?
Shivani Nyati, Head of Wealth at Swastika Investmart, said JSW Cement’s debut at Rs 153.50 amounted to a flat listing. Nyati noted the company is among India’s top 10 cement makers and is expanding aggressively through new and existing projects to double grinding capacity. However, revenue and profit growth have been uneven in the past three years, and high valuations combined with current losses could trigger short-term volatility.”Being in a growth phase, the company’s high valuation and current losses could lead to short-term volatility in returns,” said Nyati.Nyati advised IPO investors seeking listing gains to keep a stop loss at Rs 138, while medium-term to long-term investors could hold the stock for its growth potential.SimranJeet Singh Bhatia, Senior Equity Research Analyst at Almondz Global, also flagged concerns over JSW Cement’s operating performance, pointing to high debt levels and weak coverage ratios.
“The company’s operating performance continued to be weak, with concerns mainly about high debt and weak coverage ratios. On the revenue front, the company has posted growth from FY23 till date. Revenue in FY25 stood at ₹5,813 crore, while operating margins declined to 12% in FY25 from 15.37% in FY24,” said Bhatia.
Debt climbed to ₹6,166 crore in FY25 from ₹5,420 crore in FY23, with debt-to-EBITDA at 8.63x. Despite plans to nearly double its grinding capacity from 20.6 MTPA to 41.85 MTPA, Bhatia advised investors to book profits given the stretched balance sheet and soft operating metrics.
Analyst views and valuation
“JSW Cement’s Rs 3,600-crore IPO wrapped up its third and final day of bidding with full subscription, reflecting strong investor interest despite a softening in grey market premiums to around 3–4% ahead of listing,” said Gaurav Garg of Lemonn Markets Desk.
“We advise subscribing only with a long-term view, citing rich valuations and near-term earnings pressure, but highlighting the company’s strong growth potential in India’s infrastructure expansion.”
Brokerages had broadly advised long-term positions. Canara Bank Securities described JSW Cement as India’s fastest-growing and the world’s “greenest” cement producer. While flagging its higher-than-peer valuations—32x EV/EBITDA versus the 23x industry average—it backed the IPO on long-term growth, sustainability credentials, and JSW Group synergies.
AUM Capital Research cited leadership in Ground Granulated Blast Furnace Slag (GGBS) production, brand strength, and operational synergies.
SBI Securities had pointed to plans to more than double capacity to 60 million tonnes per annum by the mid-2030s, adding that profitability, hit by one-off losses, should improve through cost optimisation and new projects such as Shiva Cement’s grinding unit in FY26.
Company details and use of proceeds
JSW Cement, part of the JSW Group, is a leading green cement maker with seven plants across India and an installed grinding capacity of 20.6 million tonnes a year. Its portfolio spans blended and ordinary Portland cement, GGBS, clinker, and allied products, supported by a network of over 4,600 dealers, 8,900 sub-dealers, and 158 warehouses.
Proceeds from the fresh issue will help fund a new integrated cement unit at Nagaur, Rajasthan, repay borrowings, and meet general corporate needs. The offer for sale proceeds will go to existing shareholders.
Despite profitability in FY23 and FY24, the company posted a loss in FY25, a factor analysts say could weigh on near-term sentiment as investors watch whether JSW Cement can deliver beyond its first trading day.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)