ICICI Direct has given Buy recommendation for Sagar Cement with a target price of Rs. 315 in its research report issued on Feb 01, 2021

ICICI Direct’s research report on Sagar Cement

Sagar Cements is a south based cement player with cement capacity of 8.25 MT. Region wise, AP/Telangana accounted for ~60% of sales followed by Tamil Nadu (16%) and Karnataka (9%). Going forward, the company will be able to develop a presence in the fastergrowing eastern market and the more profitable central market with recent commissioning of new 2.5 MT capacity Self-reliance in power (61.5 MW), ability to switch between coal and petcoke for fuel requirement and split grinding units near market gives it cost advantage

Outlook

Expect costs to peak out and demand to gain traction from Q4FY22E with start of pick construction season. Hence, we maintain BUY rating We value Sagar at Rs 315 i.e.8.0x FY23E EV/EBITDA

 

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