Sagar Cements Ltd. share price target

PAT declined 90.7% YoY to | 4.6 crore (vs. I-direct estimate: | 15 crore) due to higher depreciation and interest cost What should investors do? With capacity expansions into high growth regions like...

About the stock: Sagar Cements is an efficient player in South India with cement Q2FY22 Results: Higher fuel prices caused sharp margin contraction in Q2FY22. Saw a margin contraction of 1568 bps YoY, 1081 bps QoQ to 16.5% during...

From primarily being a south-based player, the company will be able to develop a presence in the faster-growing eastern market and the more profitable central market with the commissioning of new 2.5 MT capacity Self-reliance in power (61.5 MW), ability to switch between coal and petcoke for...

The company is aiming to reach 10 MT capacity by FY25E. In the first phase, Sagar is adding 2.5 MT capacity (1 MT in MP, 1.5 MT in Odisha) for capex of | 890 crore. These capacities will get commissioned by the end of Q2FY22E. Post these expansions, the total capacity will increase to 8.25 MT. With completion of these expansions, we expect debt levels to peak around | 815...

The company is aiming to reach 10 MT capacity by FY25E. In the first phase, Sagar Cement is adding 2.5 MT capacity (1 MT in MP and 1.5 MT in Odisha) for capex of | 800 crore. These capacities will get commissioned by the end of Q2FY22E. Post these expansions the total capacity will increase to 8.25 MT. Having already spent | 545 crore, we expect debt levels to peak around...

The company is targeting to reach to 10MT capacity by FY25E. In the first phase, the company is adding 2.5MT capacity (1MT in MP and 1.5MT in Odisha) for capex of |800 crore. These capacities will likely get commissioned by end of Q2/Q3FY22E. Post these expansions the total capacity will increase to 8.25MT. Having already spent |450 crore, we expect debt levels to peak around | 750 crore and D/E to peak at 0.5x by FY22E. Low cost producer in the AP/Telangana region In the past three years, company has initiated various cost efficiency...

Going forward we expect revenues to grow at a CAGR of 23.6% to Rs.2,220 cr aided by the volume CAGR of 23.4% to 5.9 MT by FY23 (contributions from the new facilities at Indore FY22 0.1 MT, FY23 0.4 MT and Jajpur FY22 0.2 MT, FY23 0.9 MT) amidst pressure on realizations.

Sagar Cements reported a robust performance with EBITDA, PAT growth of 10%, 22%, respectively, in a challenging Q1FY21. The results were ahead of our estimates mainly on account of a sharp increase in cement prices in AP,...