Top takeaways from Q1FY17 : The much awaited price strategy realignment is here. 16% qoq realisation jump is huge (inclusive of subsidies of ~Rs350mn). Given that peer realisations have grown 7-9%, Shree Cement has realigned its pricing strategy and bridged it's realisation gap with peers. This is good news for the sector in our opinion. Resultantly, EBITDA is 28%. 19% higher than our/consensus estimates.

We have raised our realisation estimates for FY17 by 6% and hence upped our earnings estimates. Volume growth at 19% yoy though lower than estimated is still robust (4% qoq, 5% vs. our estimates). However, volume sacrifice has paid off well. Given rich valuations of US$ 280 EV/tonne (~2x replacement cost), the stock will remain rangebound. However,expect limited rerating to US$300?330/tonne if Shree Cement delivers no negative surprises to its price strategy.