Buy Dalmia Bharat; target of Rs 2208: Religare Retail Research

Religare Retail Research report on Dalmia Bharat

Dalmia Bharat posted double digit revenue growth with an increase of 10% YoY and 19.6% QoQ to Rs 4,307cr largely driven by strong volume growth of 18.3% YoY and 29.4% QoQ at 8.8MT. However, realizations remain muted and declined by 7% YoY and 7.6% QoQ to Rs 4,894/ton. For FY24, its revenue grew by 8.4% YoY to Rs 14,691cr with volume growth of 11.9% YoY at 28.8MT while realizations witnessed de-growth of 3.1% YoY to Rs 5,101/ton.

Outlook

On the financial front, we expect its revenue/EBITDA to grow by 14.1%/18.3% CAGR over FY24-26E and have maintained our rating to Buy, but revising the target price downwards to Rs 2,208, because of cement prices expected to be under pressure for 1-2 quarters and high expenses which remains a concern.