Hold JK lakshmi Cement; target Rs 138: Firstcall Research
Firstcall Research has recommended hold rating on JK lakshmi Cement with a target price of Rs 138 in its March 11, 2013 research report.
March 12, 2013 / 12:34 IST
Firstcall Research has recommended hold rating on JK lakshmi Cement with a target price of Rs 138 in its March 11, 2013 research report.
"JK lakshmi Cement is one of the most preferred brands in its marketing area with a network of about 1500 dealers spread in India. The company's net sales registered a 12.17% increase and stood at a record Rs. 4936.80 million from Rs. 4401.20 million over the corresponding quarter last year. JK lakshmi Cement Ltd has plans to invest Rs.20000 mn over the next years to take its capacity to 9 mt from 5.3 mt. JKLC has been ranked a glorious 2ndPosition in the 'Leadership Development' Category and a strong 5th in the category of 'Manufacturing and Production”. JK Lakshmi Cement Ltd has been awarded the 'MTM Corporate star award 2012 for Best Incentive Programme for Distributors/ dealers. During this quarter, JKLC's power efficiency improved to 75Kwh/MT of cement and fuel efficiency was further improved to 738 K.cal/MT of clinker. Net Sales and PAT of the company are expected to grow at a CAGR of 22% and 64% over 2011 to 2014E respectively.The company's net profit falls to Rs.412.40 million against Rs.492.40 million in the corresponding quarter ending of previous year, a decrease of 16.25%. Revenue for the quarter rose 12.17% to Rs.4936.80 million from Rs.4401.20 million, when compared with the prior year period. Reported earnings per share of the company stood at Rs.3.50 a share during the quarter, registering 12.92% decrease over previous year period. Profit before interest, depreciation and tax is Rs.1106.10 millions as against Rs.1089.50 millions in the corresponding period of the previous year.Outlook and Conclusion: At the current market price of Rs.123.25, the stock P/E ratio is at 8.00 x FY13E and 5.81 x FY14E respectively. Earning per share (EPS) of the company for the earnings for FY13E and FY14E is seen at Rs.15.41 and Rs.21.21 respectively. Net Sales and PAT of the company are expected to grow at a CAGR of 22% and 64% over 2011 to 2014E respectively. On the basis of EV/EBITDA, the stock trades at 3.10 x for FY13E and 2.59 x for FY14E. Price to Book Value of the stock is expected to be at 1.16 x and 0.97 x respectively for FY13E and FY14E. We recommend 'HOLD' in this particular scrip with a target price of Rs 138 for Medium to Long term investment," says Firstcall Research report.Bodies Corporate holding more than 50% in Indian cos Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.To read the full report click on the attachment 
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