KR Choksey has given Buy recommendation for UltraTech Cement with a target price of Rs. 8535 in its research report issued on May 02, 2022
KR Choksey’s research report on UltraTech Cement
In Q4FY22, Ultratech reported sales growth of 9.5% YoY and 21.4% QoQ at INR 1,57,673 mn. For FY22, the sales grew by 17.6% to INR 5,25,988 mn. The company has been able to maintain strong growth of 8.8% cement sales volumes in FY22 to 93.99 mntpa. EBITDA declined by 16.7% YoY due to higher input cost to INR 30,728 mn. For FY22, the EBITDA remained flat at INR 1,15,144 mn. Reported PAT has seen a growth of 44.1% QoQ to INR 24,605 mn. For FY22, the PAT grew by 17.7% to INR 71,844 mn. The company’s net debt stood at INR 37,510 mn in FY22 which implies net debt/EBITDA at 0.32x.
We have upgraded our rating from ACCUMULATE to BUY on the stocks using an EV/EBITDA multiple of 14.6x to FY24E EBITDA, which yields a target price of INR 8,535 per share (previous target INR 8,535 per share); an upside of 27.8% over the CMP.