Operating Margin - Ramco Cements Limited (NSE:RAMCOCEM)

Watchlist Manager

Watchlist

Price: 1 082.5 INR 0.39%

Market Cap: 255.8B INR

5.3%

Current

Average

5.2%

Industry

Operating Margin represents how efficiently a company is able to generate profit through its core operations.

Higher ratios are generally better, illustrating the company is efficient in its operations and is good at turning sales into profits.

Operating Margin

5.3%

Operating Profit

4.6B

Revenue

86.9B

Operating Margin Across Competitors

Country		Company	Market Cap	Operating Margin
IN		Ramco Cements Limited NSE:RAMCOCEM	255.8B INR	5%
IE	C	CRH PLC NYSE:CRH	83B USD	14%
CH		Holcim AG SIX:HOLN	42.4B CHF	17%
DE		HeidelbergCement AG XETRA:HEI	40.8B EUR	31%
IN		UltraTech Cement Ltd NSE:ULTRACEMCO	3.5T INR	13%
US		Vulcan Materials Co NYSE:VMC	38.5B USD	20%
US		Martin Marietta Materials Inc NYSE:MLM	37.7B USD	24%
DE	H	Heidelberg Materials AG XMUN:HEI	26.5B EUR	31%
US	A	Amrize AG SIX:AMRZ	23.7B CHF	16%
IN		Grasim Industries Ltd NSE:GRASIM	1.9T INR	15%
CN		Anhui Conch Cement Co Ltd SSE:600585	121.4B CNY	12%

Ramco Cements Limited
Glance View

Economic Moat

None

Market Cap

255.8B INR

Industry

Construction

Founded in the gritty persistence of India's industrial evolution, Ramco Cements Limited stands today as a formidable player in the cement industry. This company, originally known as Madras Cements, began its journey in 1961 and steadily climbed the ranks by embracing innovation and robust business strategies. The company's operations revolve around the intricate science of cement production, achieved through an integrated process involving limestone mining, raw material grinding, clinker production in kilns, and the eventual grinding of clinker with gypsum. This produces the fine powder known as cement, essential for construction. With various manufacturing plants strategically located across Southern India, Ramco Cements capitalizes on regional limestone deposits, ensuring consistency in their raw materials—critical to maintaining product quality in a highly competitive market. Ramco Cements' profitability hinges on its efficient production processes, extensive distribution network, and brand strength, carefully nurtured over decades. By optimizing logistics through well-placed distribution centers and a strong dealer network, the company ensures its product readily reaches the bustling construction hubs. Furthermore, Ramco Cements strategically differentiates itself with value-added products like ready-mix concrete and dry mortar mix, enhancing its portfolio beyond conventional offerings. Such diversification not only captures a broader market but also buffers against the cyclical nature of the cement industry. This dual focus on operational efficiency and market adaptability is the cornerstone of Ramco's financial health, positioning it as a resilient and enduring entity in the ever-dynamic landscape of construction materials.

View RAMCOCEM Analysis

RAMCOCEM Intrinsic Value

What is Intrinsic Value?

Economic Moat is a concept popularized by Warren Buffett to describe a company's durable competitive advantage. It represents the 'moat' that protects a company from competitors and helps it sustain profitability over the long term. Our analysis of the past 10 years showed that companies with a wide economic moat significantly outperformed the market, delivering +645% returns compared to +189% for the S&P 500.

Our research into Economic Moat performance spans the past 10 years and focuses on companies with a wide economic moat. For this analysis, we calculated the average stock price returns of these companies, comparing them to the performance of the S&P 500 index over the same period.

The results were compelling: wide moat stocks achieved a remarkable +645% average return, compared to +188% for the broader market. This difference highlights the long-term benefits of investing in businesses that can maintain their market position and pricing power over time.

Note: This research does not account for survivorship bias. Past performance is not indicative of future results.

Determining whether a company has an economic moat requires both a deep dive into financial metrics and a qualitative assessment of its competitive position. Our analysts conduct a rigorous evaluation that focuses on identifying structural advantages that enable a company to sustain profitability and defend its market share over the long term.

The process begins with an analysis of a company’s historical financial performance. We assess how consistently the company has generated returns above its cost of capital and whether those returns have been stable or improving. However, financial performance alone doesn’t reveal the full picture. To understand the sources of these advantages, we evaluate five key drivers of economic moats:

Network Effect: We analyze whether the value of a company’s product or service grows as its user base expands. Platforms like payment systems or marketplaces benefit from this self-reinforcing.

Switching Costs: We assess whether customers face significant costs or disruptions when switching to a competitor’s product or service. High switching costs create customer stickiness and provide pricing power.

Intangible Assets: Strong brands, patents, and regulatory licenses can protect a company’s market position by creating barriers for competitors or enabling premium pricing. For example, a well-recognized consumer brand may command higher customer loyalty and margins.

Efficient scale: Occurs when a market is optimally served by one or a few players, making it unprofitable for new entrants to compete. This typically happens in industries with high fixed costs or geographic constraints, such as utilities or pipelines.

Cost Advantage: Companies with structural cost advantages can produce goods or services at a lower cost than their competitors, enabling them to offer competitive pricing or maintain higher margins. These advantages often arise from economies of scale, superior supply chain management, or proprietary technology. Firms like Walmart leverage their massive scale to negotiate better terms with suppliers, allowing them to undercut competitors on price.

By examining these factors in combination with a company’s financial performance and market positioning, we classify each company into one of three categories:

This rigorous evaluation ensures that our moat ratings are both comprehensive and reliable, giving investors the tools they need to make well-informed, long-term decisions.

The AI Assistant may sometimes provide inaccurate information.

Make your own investment decisions or consult a licensed financial advisor.

US	Johnson & Johnson NYSE:JNJ	Pharmaceuticals
US	Berkshire Hathaway Inc NYSE:BRK.A	Financial Services
US	Bank of America Corp NYSE:BAC	Banking
US	Mastercard Inc NYSE:MA	Technology
US	UnitedHealth Group Inc NYSE:UNH	Health Care
US	Exxon Mobil Corp NYSE:XOM	Energy
US	Pfizer Inc NYSE:PFE	Pharmaceuticals
US	Palantir Technologies Inc NYSE:PLTR	Technology
US	Nike Inc NYSE:NKE	Textiles, Apparel & Luxury Goods
US	Visa Inc NYSE:V	Technology
CN	Alibaba Group Holding Ltd NYSE:BABA	Retail
US	JPMorgan Chase & Co NYSE:JPM	Banking
US	Coca-Cola Co NYSE:KO	Beverages
US	Walmart Inc NYSE:WMT	Retail
US	Verizon Communications Inc NYSE:VZ	Telecommunication
US	Chevron Corp NYSE:CVX	Energy

	Johnson & Johnson NYSE:JNJ	208 USD 0.25%
	Berkshire Hathaway Inc NYSE:BRK.A	750 343.555 USD 0.72%
	Bank of America Corp NYSE:BAC	56.3034 USD 1.19%
	Mastercard Inc NYSE:MA	588.46 USD 1.47%
	UnitedHealth Group Inc NYSE:UNH	345.43 USD 1.09%
	Exxon Mobil Corp NYSE:XOM	120.29 USD 1.52%

	Franklin Covey Co NYSE:FC	16.9425 USD -4.92%
	Mohawk Industries Inc NYSE:MHK	112.94 USD 5.68%
	Ardmore Shipping Corp NYSE:ASC	11.6706 USD 0.01%
	ASGN Inc NYSE:ASGN	50.11 USD 3.6%
	Skyworks Solutions Inc NASDAQ:SWKS	60.72 USD 1.5%
	Weatherford International PLC NASDAQ:WFRD	86.68 USD 0.37%

	Johnson & Johnson NYSE:JNJ	208 USD 0.25%
	Bank of America Corp NYSE:BAC	56.3034 USD 1.19%
	Mastercard Inc NYSE:MA	588.46 USD 1.47%
	Salesforce Inc NYSE:CRM	262.58 USD -1.33%
	Abbvie Inc NYSE:ABBV	227.62 USD -2.48%
	Home Depot Inc NYSE:HD	358.775 USD 2.78%

	Monolithic Power Systems Inc NASDAQ:MPWR	949.47 USD -1%
	Applovin Corp NASDAQ:APP	621.08 USD -1.87%
	Apple Inc NASDAQ:AAPL	256.6955 USD -1.4%
	NVIDIA Corp NASDAQ:NVDA	186.6916 USD -1.28%
	Cal-Maine Foods Inc NASDAQ:CALM	76.865 USD -1.21%
	Pro Medicus Ltd ASX:PME	215.92 AUD 0.43%

Ramco Cements Limited
NSE:RAMCOCEM