Sell Shree Cement; target of Rs 14565: HDFC Securities
HDFC Securities is bearish on Shree Cement has recommended sell rating on the stock with a target price of Rs 14565 in its research report dated May 17, 2017.
HDFC Securities' research report on Shree Cement
Shree Cement (SRCM) numbers disappointed (EBITDA/t: Rs 818 vs est 934, flat YoY, -16.1% QoQ). This was largely on account of a strong surge in freight, (Rs 1,023/t, 27.9% YoY, 19.5% QoQ), while P&F and RM costs hardened too.
We have cut our volume estimates by 4.5/6.3% resulting in lowering of EBITDA estimates by 8.3/11.7% for FY18/19 respectively. Maintain SELL with a TP of Rs 14,565 based on 12.0x FY19 cement EV/EBITDA (implies US$190/t on FY19 exit capacity of 38.6 mTPA).
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