Kajaria Ceramics has reported a muted set of numbers in 2QFY18 mainly due to transitionary impact of GST roll-out. While its consolidated net sales grew by 6.7% YoY to Rs6.7bn vs. our estimate of Rs6.9bn, net profit came in largely flat at Rs630mn vs. our estimate of Rs656mn, and EBITDA margins contracted by 190bps YoY to 18.2%. Despite near-term headwinds, we believe that Kajaria Ceramics is comfortably placed to benefit from increasing share of organised tiles industry in GST regime. Being the market leader, the Company has made concerted efforts to create and enhance its brand strength, improve productmix and build a strong product pipeline. Expecting the Company to report 12.2% revenue and 18.8% earnings CAGR through FY17-19E, we maintain our BUY recommendation on the...