Buy Orient Cement; target of Rs 150 : ICICI Direct

ICICI Direct's research report on Orient Cement

Orient Cement is a mid-sized (8.0 MT) cost-efficient player in the cement space. Its cement plants are located in Devapur, Telangana (3 MT integrated), Chittapur, Karnataka (3 MT integrated), Jalgaon, Maharashtra (2 MT grinding unit). The company derives revenues largely from Maharashtra (50%), Telangana, Karnataka and MP markets • It also has 101 MW power plant (95 MW CPP, 6 MW WHRS) that makes it selfsufficient in terms of power requirements.

Outlook

With a strong balance-sheet, the company is now in a better position to withstand the cost challenges. We value Orient at Rs 150 i.e. 6.0x FY24E EV/EBITDA.