Motilal Oswal has given Neutral recommendation for Shree Cement with a target price of Rs. 23,740 in its research report issued on May 22, 2022

Motilal Oswal’s research report on Shree Cement

SRCM’s 4QFY22 earnings were below our estimate due to lower realization (2% lower than our estimate). EBITDA stood at INR9.1b (est. INR9.9b) and EBITDA/t came in at INR1,134 (est. INR1,249). Adjusted profit was in line at INR5.5b. It commenced commercial production at its clinker unit (Line-III) in Chhattisgarh, with a capacity of 12,000tpd (3.96mtpa) in Mar’22. We reduce our FY23/FY24 EPS estimate by 7%/3% on higher costs.

Outlook

The stock trades at 21x/16.2x FY23/FY24 EV/EBITDA, which leaves little room for any disappointment. We maintain our Neutral rating on reducing cost benefits v/s its peers.

Leave a Reply

Your email address will not be published.