India Cements Ltd. share price target

ICL's Q4 operating numbers were largely in line; no major disappointment except for the marginallossofrealisationandinabilitytoaccelerateusageofpetcoke. WehostedtheQ4call.Herearebrieftakeaways...

India Cement's (ICL) results were in line with our expectation. Q4FY16 revenues increased 11.9% YoY to | 1,147.1 crore (in line with I-direct estimate: | 1,154.3 crore) led by 18.0% YoY increase in volumes (driven...

Healthy volume and cost benefit lead to healthy performance India Cements' (ICL) reported performance was impressive and ahead of our estimates as its operating profit grew by ~16% yoy & ~45% qoq to Rs2.11bn v/s our estimate of Rs1.62bn. Improved utilizations (~68% in 4QFY16 v/s ~58% in 9MFY16) along with substantial drop in variable costs (fuel and freight) dragged operating cost/tonne to Rs3,756 (-5% yoy & -6% qoq). Sales volume improved strongly to 2.48mnT (+18% yoy & +28% qoq) owing to robust demand in AP/ Telangana markets. Realizations were tepid with ~4% qoq decline owing to price...

8 ICL's Q3 operating numbers were lower than our and consensus estimates driven by higheropexandslightlylowerthanexpectedrealisations. 9 NodisappointmentinQ3onvolumes,whichwasapositivesurprise.Volumeswere4%...

Faded performance; Maintain BUY on better expectations India Cements Ltd's (ICL) operating performance came in below the expectation and was impacted by a slide in average realizations (-3% qoq) and a spike in raw material costs/tonne (+15% yoy). EBITDA declined by ~8% yoy to Rs1.46bn as against the estimate of Rs1.57bn. Cement EBITDA/tonne came in at Rs743. Sales volume, however, remained tepid at 1.94mnT (-8% yoy and -11% qoq) owing to persistent weak demand in its key markets and severe flood in Tamil Nadu. Reported net profit came in below the expectation at Rs55mn v/s net loss of...

India Cements (ICEM) operating performance for 2QFY2016 has come in better than our and street estimates. ICEM reported an EBITDA growth of 27.6% yoy to Rs228.6cr, which is above our estimate of Rs193.9cr. The EBITDA margin improved by 536bp and came in at 21.2%, which is above our estimate of 17.7%. Consequently the net profit jumped to Rs41cr as against Rs7.5cr during the same quarter last year. The net profit was higher on account of better than expected EBITDA numbers and lower depreciation and interest expenses. The top-line is marginally below our estimate, mainly due to weak cement demand and subdued realization. The realization/tonne fell 2.4% qoq (improved by 5.8% yoy) to `4,925 and was below our estimate of Rs4,995. EBITDA margin jumps 536bp yoy: ICEMs top-line fell by 4.6% yoy, impacted by low demand in its key markets of South India. The companys cement sale volume was down by 8.1% yoy to 2.16mn tonne (mt) and was in line with our estimate of 2.15mt. Cement realization fell 2.4% qoq to Rs4,925/tonne and was below our estimate of Rs4,995/tonne. However, the OPM improved by 536bp on a yoy basis to 21.2%, aided by a decline in operational costs. The company...

India Cements Ltd's (ICL) reported performance was impressive and ahead of our estimates as operating income (adjusted for reversal of excess DMF provisioning of Rs200mn) witnessed a growth of ~16% yoy and ~7% qoq to Rs2.08bn, above our estimate of Rs1.70bn. A substantial reduction in variable costs has been prime reason for the variance. Sales volume, however, remained tepid at 2.17mnT (down ~8% yoy) owing to persistent weak demand in its key markets. Cement operating cost/tonne declined by ~3% yoy and ~6% qoq on account of: a) write-back of excess DMF provisioning of Rs200mn (for Jan-June'15), b) reduction in inward...

9 There is potential for a marginal upgrade to our FY16/17 estimates. However, at this point,wecontinuetomaintainourearlierestimates. 9 Q2FY16couldbeaturnaroundpointforstockperformance.Areratingtriggercouldbe...

India Cements Ltd's (ICL) reported performance came in better than expectation as operating income witnessed a growth of ~24% yoy and ~7% qoq to Rs1.95bn above our estimate of Rs1.65bn. A substantial jump in realizations (up ~19% yoy) resulted in strong operating performance. However, sales volume remained tepid at 2.1mnT (down ~18% yoy) owing to persisting weak demand in its key markets. Cement operating cost/tonne increased by ~13% yoy on account of: a) DMFF provisioning of Rs170mn, b) royalty hike in limestone, c) higher freight costs due to railway freight hike and d) change in market mix. We maintain BUY on the stock...

India Cements (ICEM) reported an industry leading EBITDA/t (Rs756, 32.5% YoY, 16.2% QoQ). This was driven by strong realizations (Rs 4,802/t, 9.0% YoY, 3.2% QoQ) as prices improved sharply in the South. Costs remained flat (1% QoQ) despite lower volumes as ICEM reported cost moderation in all key components.