Shree Cements Ltd. share price target

Shree Cement (SRCM) Q4FY21 EBITDA was in-line with our and consensus estimate. SRCM volume increase at +19% YoY was strong. Post the result we have increased EBITDA estimate for FY22E and FY23E by 6% and 11%. This factors higher ASP (as Q4FY21 realization is up 4% QoQ), lower opex/t versus earlier estimate for FY22E/23E. We continue to value SCRM at 18x FY23E EV/EBITDA and revised TP is Rs25,610 (earlier Rs22,517). But given there is a down downside of 7% to our fair value, we lower stock rating to reduce. SRCM valuation premium to UTCEM has narrowed to 35% (from the highs of 80%) vs. historical average of 45%. But expectation of weak 1HFY22 is weighing...

Shree Cements posted over two-fold jump in consolidated net profit to Rs.630.87 crore for the third quarter ended December 31, 2020. It had reported a net profit of Rs.309.63 crore in October- December period a year ago. Revenue from operations was up 13 per cent to Rs.3,541.38 crore during the quarter under review as against Rs.3,146.01 crore in the year-ago period. Total expenses were at Rs.2,797.24 crore as against Rs.2,801.89 crore. OPM of the company increased by 383 bps to 31.79% leading to 28% increase in operating profits to Rs 1125.92 crore. Other income was up by 65% to Rs 108 crore. As a result PBDIT...

Shree Cement Limited provides building materials. The company manufactures and sells cement and cement products in India. The company currently operates with a total cement capacity of 44.4mpta of which...

Stronghold in high growth markets of North, East region SCL is one of the strongest players in the northern region with operating units at Rajasthan, Haryana, Uttar Pradesh and Uttarakhand. Apart from stronghold in north, which accounts for ~66% of revenues, the company also has increased its share in east and south markets with operating units at Chhattisgarh, Jharkhand and Bihar as well as operating unit in Karnataka. The share of eastern region increased from 21% in FY17 to 25% as of FY20. The company's strategy to adopt split grinding units close to user markets...

Shree Cement (SRCM) Q3FY21 EBITDA was higher than our estimate by 13%. Beat in the number is driven by volume, as SRCM reported volume growth of +15% YoY vs. our estimate of 10%. Sales in North, East led SRCM to report double digit volume growth. Post the result, we have changed volume assumption and increased EBITDA by 5%/6% (exhibit 9) for FY22E/23E. TP is revised upward to Rs22,517 (earlier 21,472), valued on an unchanged EV/EBITDA multiple of 18x. Stock in the last one month is down by 13%, this has made us to revise our rating to HOLD from REDUCE earlier. SRCM valuation...

Shree Cement (SRCM) reported a strong 3QFY21 result, with EBITDA growing 28% YoY to INR10.9b, led by above-industry volume growth of 15% YoY. While we expect volume growth over the next two years to track the industry at a 10% CAGR, we expect stock underperformance to continue as new capacity additions are slower than anticipated, diluting ROE. We lower our FY21/FY22 EBITDA estimate by 1%/3% and TP by 2% to INR24,300, factoring in higher costs. We maintain Neutral as the current valuation (16x FY22E EV/EBITDA) prices in earnings growth....

Shree Cement Limited provides building materials. The company manufactures and sells cement and cement products in India. The company currently operates with a total cement capacity of 44.4mpta of which...

Shree cement (SRCM) reported Q2FY21 EBITDA above our/consensus estimates (CE) by 7%/20% at Rs9.9bn, up 17% YoY. The beat was largely led by better than expected realisations. SRCM has evolved as a mature player over last couple of years with discipline on both volumes and prices in its North markets (constitutes 2/3rd of its volumes). This is reflected in highest ever margins since FY09. However,...

Shree Cement Q2 Results: Profit Rises 77% Led By Lower Costs Shree Cement Ltd.'s quarterly profit rose amid lower expenses and depreciation. Net profit increased 70% year-on-year to Rs 526.97 crore in the quarter ended September. Revenue rose 8% year-on-year to Rs 3249.93 crore. The company operating margins up by 163 bps to 30.76%. As a result operating profit was up by 14% to Rs 999.73 crore. Profit before interest,...

Shree Cement (SRCM) Q2FY21 EBITDA was higher than our and consensus estimate by 37-40%. Beat in the number is driven by volume, as SRCM reported volume growth of +14% YoY. Volume growth is led by all the three regions of SRCM i.e. North, East and South. For FY21E, excluding the covid disruption (Q1FY21) SRCM guides volume growth of +7% to 8% YoY. Post the result, we have changed our volume assumption for FY21E/22E and increase EBITDA by 15%/11% (exhibit 9). We have introduced FY23E financials and roll forward TP from FY22E to FY23E. Our revised TP is Rs21,963 (earlier 20,361) valued on unchanged EV/EBITDA multiple of 18x. But retain REDUCE rating on...