Angel Broking neutral on JK Lakshmi Cement

Angel Broking has maintained neutral rating on JK Lakshmi Cement, in its February 08, 2013 research report.
 
“JK Lakshmi Cement (JKLC)’s net profit in 3QFY2013 fell by 16.2% yoy impacted by steep increase in freight costs. Volume grew by a marginal 2.7% on a yoy basis. Realization rose by 9.8% on a yoy basis, but was down by 3.2% on a qoq basis.”
 
“During 3QFY2013, JKLC registered a robust top-line growth of 12.2% yoy to `494cr. Volumes stood at ~1.26mn tonne, up 2.7% on a yoy basis, impacted by slowdown in cement demand in all of the company’s markets. The company’s volume performance is much better than the de-growth/flattish performance posted by some of its peers as demand remained subdued during the quarter. Cement realization grew by 9.8% yoy and stood at `3,689/tonne. OPM declined by 153bp yoy to 19.9%. Although power and fuel costs/tonne were down by 18.1% yoy aided by lower petcoke prices (down from `7,000/tonne in 2QFY2013 to `6,500/tonne in 3QFY2013) and better efficiency in power usage, freight costs/tonne shot up by 22.4% yoy due to increase in diesel prices and railway freight charges. EBITDA/tonne stood at `781, up 1.4% on a yoy basis. However, on a sequential basis it declined by a steep 16.1% on account of fall in realization.”
 
“Going ahead, we expect JKLC to post a 29.3% CAGR in its bottom-line over FY2012-14, due to its presence in high growth regions. At the current market price, the stock is currently trading at an EV/tonne of US$57 (on FY2014E capacity). We recommend a Neutral rating on the stock,” says Angel Broking research report.

FIIs holding more than 30% in Indian cos

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