Sharekhan's research report on The Ramco Cements
The company reported lower than estimated earnings in Q1FY22 affected by strict lockdowns in key regional markets viz. Tamil Nadu & Kerala due to the second wave of COVID. However, EBITDA/Tonne remained broadly in-line. Management is confident of 20% y-o-y volume growth for FY2022 barring the possibility of a third wave impact expecting Southern markets to outpace other regional markets in terms of growth. The commissioning of 2.75MT clinker capacity before Q2FY2022 to improve clinker availability. Addition of 1MTPA cement capacity, 18MW WHRS & 18MW TPP to be completed by FY2023.
We maintain Buy The Ramco Cements Limited (Ramco) with a revised PT of Rs. 1,310, considering the improving demand and pricing environment in its regional markets.
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