Moneycontrol
Last Updated : May 17, 2018 05:11 PM IST | Source: Moneycontrol.com

Hold Orient Cement; target of Rs 150: Centrum

Centrum recommended hold rating on Orient Cement with a target price of Rs 150 in its research report dated May 04, 2018.

Broker Research @moneycontrolcom
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

Centrum's research report on Orient Cement


Orient Cement (ORCMNT) posted flattish EBITDA YoY in Q4FY18, as increased competition drove volume decline YoY, and aggressive pricing led to weak NSR QoQ. Lower opex QoQ moderated YoY cost inflation. The JPA’s assets acquisition is getting delayed owing to pending approvals. We remain wary of this inorganic acquisition which will keep leverage high, and return ratios subdued. We maintain HOLD with TP of Rs150.


Outlook


We maintain HOLD on the company with a TP of Rs150/share (no change), valuing it at 8.5x FY20E consolidated EBITDA. Out TP implies replacement value of USD87/MT. We remain wary of the impact of the inorganic acquisition on balance sheet (net D:E to remain at 1.2-1.4x during FY18-20) and return ratios (RoCE net of taxes to only marginally improve to 6%/8% during FY19/20).


For all recommendations report, 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.

First Published on May 17, 2018 05:11 pm
Loading...
Sections
Follow us on
Available On