Hold Dalmia Bharat; target of Rs 2230: Axis Securities

Axis Securities recommended hold rating on Dalmia Bharat with a target price of Rs 2230 in its research report dated July 13 2023.

Broker Research

July 13, 2023 / 17:39 IST

hold

26 Aug, 2025 12:21

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Axis Securities report on Dalmia Bharat

Dalmia Bharat Limited (DBL) –is one of the established cement player sin India. The company expanded its cement capacity from 35.9 MTPA to 38.6 MTPA. In Apr’23, the company also started operations ata second cement line in Bokaro, Jharkhand, with a capacity of 2.5 MTPA. It also signed the definitive agreement for the acquisition of the strategically located cement assets of Jai prakash Associates Limited, (9.4 mtpa Grinding and 6.7 mtpa Clinker capacity at an enterprise value of Rs5,670 Cr). This will enable the company to enter the lucrative growth market of central India. DBL aims to expand its total cement grinding capacity from the current 41 MTPA to 46MTPA, excluding JP Assets by FY24. In the medium term, the company aims to reach a capacity of 75 mtpa by FY27.Its long-term goal is to reach 110-130 mtpa capacity by FY30-31 to capture further growth opportunities and become a pan-India player. The company undertook Capex of Rs 2,814 Cr during the year. In FY23, its gross debt increased by Rs 623 Cr to Rs 3,763 Cr, up 19.8%owing to term loans it availed to fund ongoing capacity expansion projects. Consequently, its Net Debt/Equity increased to 0.04 in FY23 from (0.09) in FY22.

Outlook

We value the company at 11x FY25E EV/EBITDA to arrive at a TP of Rs 2,230/share, implying an upside potential of 8% from the CMP. We hence change our rating from BUY to HOLD..

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