Accumulate UltraTech Cement; target of Rs 4069: Dolat Capital
Dolat Capital recommended accumulate rating on UltraTech Cement with a target price of Rs 4069 in its research report dated May 20, 2020.
May 22, 2020 / 05:04 PM IST
Dolat Capital's research report on UltraTech Cement
Revenue and EBITDA broadly in line, however PAT above estimates. UTCEM posted 13.1% YoY de-growth in revenue to Rs107.5 bn due to 15.7% YoY volume decline to 21.4 mt which was partially offset by 3.0% YoY rise (+1.2% QoQ) in realization to Rs5,012/tn. EBITDA/ APAT grew (3.9%)/ 6.5% YoY to Rs24.4 bn/ Rs11.3 bn. We 0.9%/ (-1.3%)/ 2.1% revenue/ EBITDA/ APAT CAGR over FY20-22E led by (-15.1%)/ 20.0% volume growth and (-1.0%)/ 1.0% realization growth in FY21E/ FY22E. We expect EBITDA/tn to marginally cool off to Rs1,004 (FY21E)/ Rs1,078 (FY22E) vs. Rs1,128 (FY20).
Thus, we recommend Accumulate with a TP of Rs4,069 based on 14x (10% discount to 3/5 year averages) consolidated FY22E EV/EBITDA.
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