Prabhudas Lilladher's research report on Cera Sanitaryware
Cera Sanitaryware (CRS) has reported modest results amid the weak demand scenario. The B2B segment showed improved momentum in the quarter, partially offsetting slower demand in the retail space for CRS. CRS reported 5.4% growth in revenue with ~140bps contraction in EBITDA margin due to increase in employee cost and B2B contribution. CRS aims to outperform the industry by 6-7%, with EBITDA margin of 15-16% by the end of FY26. The company continues to hold off its sanitaryware expansion plans until the demand environment improves. We estimate revenue/ EBITDA/PAT CAGR of 11.4%/12.2%/10.7% over FY25-27E.
Outlook
We downward revise FY26/FY27E earnings estimate by 1.9%/2.8% and reduce TP to Rs7,178 (Rs7,389 earlier), based on 30x FY27E earnings. Maintain ‘Accumulate’ rating.
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