HDFC Securities' research report on Heidelberg Cement
Heidelberg Cement’s (HEIM) revenue fell 2% YoY to Rs 5.14bn, as sales volume fell 2% (focus on better pricing sales). However, healthy realisation and low opex further boosted EBITDA/APAT by 3/7% YoY to Rs 1.26/0.62bn. Balance sheet remains strong – with negative cash conversion of 22 days and net cash on books increasing to ~Rs 1.8bn.
We continue to like HEIM for its retail presence in the lucrative central market, increased volume growth visibility, superior margin and return ratios and a net cash balance sheet. We maintain BUY with an unchanged target price of Rs 234/sh (8.5x Sep’22E EBITDA).
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