Hold with a Short Term Target 235/-
A seasonally slow quarter for the Industry where the company has increased revenues and shown stronger profitability
Financial Highlights
➔ Reported EPS of 3.49 vs our estimates of 3 along with a 9% increase in revenues YoY
➔ The company reported its highest ever
◆ Quarterly Revenue
◆ Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
◆ Profit after Tax (PAT)
➔ Increase in raw material and fuel prices were partially
offset by lower freight & forwarding expenses.
➔ PAT Margins have improved 405bps from 9.5% to
13.6%
➔ CONTINUES TO WORK ON NET NEGATIVE WORKING
CAPITAL
Industry Highlight and Future Outlook
★ Total estimated installed cement capacity at 480 Mn T as on Jun’ 19
★ Trailing Twelve Month volume growth at 11% driven by growth in Infra and Housing
★ While the last FY ended on high utilisation of over 70% FY 20 utilisations have been low.
★ We estimate the industry to continue to grow at the current or even a higher rate owing to the
○ Stable Govt Spending in Infra
○ Planned Govt Spending on the Water
Initiatives
○ Lower Interest Rates
○ Stability of Crude
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