Hold India Cement;target of Rs 80: ICICI Direct

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26 Aug, 2025 12:21

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ICICI Direct's research report on India CementIndia Cement’s (ICL) results were below our expectation. ICL’s Q3FY16 revenues declined 10.3% YoY (down 13.9% QoQ) to | 929.6 crore due to transfer of the IPL division to a trust and decline in cement revenues. Cement division reported 9.9% YoY drop in the revenues led by 8.2% YoY fall in volumes (owing to floods in company’s key markets) and 1.8% YoY decline in realisation Cement EBITDA/tonne declined 3.1% YoY to | 732/tonne led by lower utilisation and higher other cost/tonne. Net profit came in at | 5.5 crore vs. | 11.7 crore net loss in Q3FY15 led by decline in depreciation and interest expenses With better realisations in the South and improved outlook on the demand side on verge of formation of new state, we expect utilisations to improve from hereon. However, unrelated investments, elevated debt levels and ongoing litigations remain a key concern on company’s long-term growth prospect. Hence, despite the attractive valuations, we continue to maintain HOLD rating on the stock with revised target price of | 80 (i.e. valuing at $55/tonne on FY17E capacity and 6x FY17E EV/EBITDA). For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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