India Cements Ltd. share price target

India Cements (ICEM) reported EBITDA of INR1.6b (~37% beat) in 4QFY26 vs. INR11m in 4QFY25. EBITDA beat was led by all-round operating strength. EBITDA/t increased ~62% QoQ to INR498 (vs. est. INR396).

India Cements (ICEM) reported EBITDA of INR795m (~35% beat) in 3QFY26 vs. an operating loss of INR1.9b in 3QFY25. EBITDA beat was led by higher volume and lower opex/t vs. our estimates.

India Cements (ICEM) has seen it all – from M&A-led buoyancy (over past few years) to a more recent overhang of stakesale by new promoter UltraTech Cement (UTCEM; to comply with minimum public shareholding norms).

India Cements (ICEM) reported EBITDA of INR819m (21% beat) in 1QFY26 vs. operating loss of INR310m in 1QFY25. The improvement in operating performance was led by cost control measures, as opex/t was down ~15% YoY in 1QFY26.

India Cements (ICEM), following the recent change in management (the first quarter after UTCEM took control), has reported an improved performance in 4QFY25. It has reported an EBITDA of INR5m (vs. an estimate of an operating loss of INR1.2b) in 4QFY25.

India Cements (ICEM) reported an operating loss of INR1.9b (vs. estimated loss of INR854m) in 3QFY25. Sales volume increased ~5% YoY to 2.1mt (~2% below our estimate), while blended realization declined ~20% YoY to INR4,333 (~5% below our estimate).

India Cements (ICEM) is ‘walking-the-talk’ regarding the sale of its non-core assets. In a second such transaction, ICEM has agreed to sell its surplus land in Andhra Pradesh (near Vizag) for INR 700mn to industry-leader UltraTech Cement (UTCEM). In Oct’22, ICEM sold its entire stake in subsidiary Springway Mining Pvt Ltd (SMPL) to JSW Cement for INR 4.77bn.

Profitability continued to drag its feet at India Cements (ICEM) even as EBITDA for Q1FY24 turned positive (albeit a mere INR 50mn). Performance continues to be impacted by: a) poor volume growth (flat YoY), b) weak realisations (down ~1% QoQ), and c) high operating cost – leaving little on the table for the company.

India Cements (ICEM) has posted an EBITDA loss for the third consecutive quarter. EBITDA loss in Q4FY23 stood at Rs445mn vs a loss of Rs695 in Q3FY23 and a profit of Rs615mn in Q4FY22. While volumes rose ~5% YoY, weak cement prices and elevated fuel cost got the better of ICEM.

Pricing power is crucial in the commodity business and the Indian cement sector is certainly losing the plot on that front. Elevated competitive intensity across regions, has prevented margin-accretive price hikes, despite: a) robust demand (Q4FY23E prices slipped ~1% QoQ notwithstanding peak season volume surge of ~10% YoY)

India Cements’ (ICEM) Q3FY23 EBITDA loss at Rs66mn (down 160% YoY) was higher than our estimates (consensus expected EBITDA profit) as the company was unable to pass on the elevated cost pressures.

India Cements’ (ICEM) Q2FY23 EBITDA at Rs0.9bn (down 164% YoY) was way below our / consensus estimates due to hit from higher input costs.

India Cements’ (ICEM) Q1FY23 EBITDA at Rs0.4bn (down 77% YoY) was below our / consensus estimates due to hit from higher input costs.

India Cements (ICEM)'s 2QFY22 result was in line with our estimates, although earnings were under pressure due to higher costs. The lower base of last year aided volume growth of 12% YoY; this was offset by a 13% YoY increase in opex/t, leading to a 49.2% YoY drop in blended EBITDA/t. We maintain our FY23E/FY24E estimates and Neutral rating on the stock as valuations at 12x/9.3x FY23/FY24E EV/EBITDA appear expensive. Higher volatility in earnings due to the demand-supply mismatch in the South region and higher leverage (net debt/EBITDA at 4.5x/3.6x FY22/FY23E) in the...

India Cements (ICEM)'s 4QFY21 EBITDA came in 4% below estimate due to higher costs. This was partly attributable to higher selling in the faraway markets of East and Central, which offset weaker demand in South the company's core market. Capacity utilization stood at just 57% in FY21. Net debt declined 15% YoY to INR30.0b in FY21 as the company repaid INR5.3b worth of debt on strong OCF and negligible capex. We raise our FY22E/FY23E EPS by 5%/17%, factoring in lower interest costs from deleveraging as the company continues to delay its capex plans. It...

India Cements (ICEM)'s 3QFY21 EBITDA was 10% below estimate, weighed by a weaker sales mix. This is attributable to higher selling in non-trade and faraway markets in the East and Central regions of India to offset weak demand in its core market in South. We reduce our FY21/FY22E EPS by 14%/7% as the company has guided for the continuation of this strategy to support utilization which would lower average realization and increase freight cost. Maintain Neutral....

India Cements (ICEM)'s 2QFY21 results highlight the benefit of high cement prices in South India, which led to the highest EBITDA/t since FY14 at INR1,114/t (+102% YoY). Volumes, however, declined 21% YoY due to weak cement demand in South India and market share loss. We raise our FY21/FY22E EPS by 28%/2%, factoring in a strong realization outlook on the back of a strong production discipline in South. However, we retain our Neutral rating on expected market share loss and a valuation of 9.4x FY22E EV/EBITDA, pricing in strong margins....