Accumulate Dalmia Bharat; target of Rs 3325: KR Choksey

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26 Aug, 2025 12:21

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KR Choksey's research report on Dalmia Bharat

Net Sales stood at INR 18337 mn as against our estimates of INR 18150 mn; which was up by 7% y-o-y and down 10.4% q-o-q. Volumes for the quarter stood at 3.64 MT(est of 3.66 MT) which grew by 6.4% y-o-y.  EBIDTA stood at INR 4414 mn which was up by 4.9% y-o-y and down 20.7% q-o-q and EBIDTA margin stood at 24.1% (est. of 23.4%) as against 24.6% same quarter last year. EBITDA stood 3.9% higher than our estimates of INR 4250 mn while EBITDA/ton during the quarter stood at INR 1211. PAT stood at INR 1037 mn (est. of INR 510 mn) which grew by 233.4% y-o-y and down by 36.7% q-o-q. Sharp jump in net profit on y-o-y basis was on account of higher tax base.

Outlook
We value Dalmia Bharat Ltd at an EV/EBITDA of 12x FY19E on account of a.)financial de-leveraging, b.) outperforming volume growth, c.) robust market share of 8%/15%/21% in South/East/North-East and d.) superior operating efficiencies; arriving at a target price of INR 3325 translating into an upside of 13.5% from CMP of INR 2930. We have an ACCUMULATE rating on the stock.
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