Sushil Finance has recommended hold rating on Kajaria Ceramics with a target of Rs 234 in its January 22, 2013 research report.
“ Kajaria Ceramics , for the quarter ended Q3FY13, it has posted total sales on consol basis of Rs.4177.1 mn, registering a growth of 19% YoY and 7% QoQ (driven by product mix & increased domestic demand). The EBITDA grew by just 8% YoY to Rs.606.8 mn while the EBITDA margins decreased by 150 bps YoY to 14.5% due to increase in power and fuel cost. Its PBT (including other income) increased by 25% YoY to Rs.378.5 mn. APAT stood at Rs.249.5 mn registering a growth of 18% YoY with net profit margin at 6% flat on YoY basis. Its AEPS for the quarter stood at Rs.3.4.”
“KCL has performed exceedingly well in the past few years on the back of rising tiles demand, leveraging its strong brand & distribution network, focus on value added products & consistent expansion in its capacities organically as well as inorganically. Given its strong market positioning, increased capacities of its vitrified tiles, foray into new product lines, we expect KCL to deliver strong growth over the coming years. After incorporating its Q3FY13 numbers which were slightly lower than our expectations due to higher power & fuel cost, we have reduced our estimates; we expect its Revenues and APAT to grow by 24.4% & 28% in FY13 and 19.8% & 30.1% in FY14 respectively. We retain our “HOLD” rating on the stock with a price target of Rs 234,” says Sushil Finance research report.
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