Buy J K Cements; target of Rs 1534: Anand Rathi

Anand Rathi 's research report on J K Cements

On higher realisations and cost savings in Q4, J K Cements’ EBITDA rose 24% y/y, though revenue dipped 1% y/y on lower volumes. The company said all capex would begin with a delay of 3-4 months and it would focus on cost optimisation and conserving cash. We expect the ongoing expansion to keep leverage high; however, the ramp-up of the new capacities would help restrict volumes falling y/y in FY21.

Outlook

We retain our Buy rating, with a higher target of `1,534 (earlier `1,287).

J K Cements 22062020