Shree Cements Ltd. share price target

Shree Cements’ Q2 was muted due to the weak demand-pricing environment, owing to prolonged monsoons and low infrastructure spends by the government.

We retain a Buy rating on Shree Cement with a revised PT of Rs. 28,800, factoring a marginal downward revision in operational profitability led by lower volume growth than earlier envisaged.

Realisation dent drags revenue growth by a steep 19%/23% in Q2FY25, partially offset by relatively lower volume decline of 7% YoY

We maintain our HOLD rating on the company

Shree Cement (SRCM)’s 2QFY25 EBITDA was in line as lower-than-estimated
realization/t was offset by lower-than-estimated opex/t.

Maintaining market share will be the key priority in the supply glut market situation, though capacity utilisation may hover ~70%

Shree Cement’s (SRCM) volume focus in Q1FY25 was exceptional given it stood flat QoQ (up 8% YoY) as against 5-20% drop reported by industry majors.

We change our rating from BUY to HOLD

Standalone revenues marginally lagged estimates at Rs. 4835 crore (down 2.7% y-o-y) as lower than
estimated realisations (down 10% y-o-y, on higher sales in the Eastern region.

Shree Cement (SRCM)’s 1QFY25 EBITDA was significantly below our estimate, primarily due to a lower-than-estimated realization (6% miss).

JKCE: Focused on growth; earnings intact; upgrade to BUY. RBI Dividend: Record high. SRCM: Cost savings key driver of performance; valuations pricey. BANDHAN: In line with recovery plan. ERIS: Strong revenue growth; integration ongoing. MTLM: Misses estimate on weak plywood margin; upbeat outlook.

We maintain our BUY rating on the stock.

Shree Cement’s (SRCM) Q4FY24 EBITDA/t, at INR 1,347, has yet again stood at the highest level among peers.

Q3 revenue growth of 20% YoY backed by sharp 11% volume uptick to 8.9mt