Hold Shree Digvijay Cement; target of Rs 78: Arihant Capital

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26 Aug, 2025 12:21

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Arihant Capital's research report on Shree Digvijay Cement

Shree Digvijay Cement Company Limited (SDCCL) reported weak set of numbers in Q3FY22 especially on the operational front. Net Revenue grew by 5.6% YoY, however declined by 1.5% QOQ to INR 1516 mn above our expectation of INR 1200 mn . Topline growth on YOY basis was mainly due to rise in realization/tonne. Sales volume de grew by 4.7% YoY, and 2.7 Q0Q to 2.87 lakh tonnes in line our expectation of 2.70 lakh tonnes. Volume was impacted amid lower demand and also plant shut down in quarter. Realization /tonne grew by 10.8% YoY and 1.3% QoQ to INR 5282 above our expectation of INR 4000. Company managed to achieve good realization growth amid improved blended portfolio along with consumption of alternate fuel. EBIDTA declined by 29% YoY and 31% QoQ to INR 191 mn below our expectation of INR 198 mn, EBIDTA margin contracted by 622bps YoY, and 533 bps QoQ to 12.6%. Operating cost increased substantially by 12.5% YoY and 8.9% QoQ to INR 1062 led by high fuel and transportation cost beside this muted topline growth led by plant shutdown and low demand also impacted the margins. EBIDTA /tonne declined by 26% YoY & and 29% QoQ to INR 666 in line with our expectation of INR 660.

Outlook

We value the stock at a EV/EBIDTA multiple of 4.3x to its FY24E EBIDTA of INR 1981 mn to arrive at a target price of INR 78 which gives potential upside of 9.9%% from current level.

More Info on Trent

At 16:00 hrs Shree Digvijay Cement Company was quoting at Rs 72.75, down Rs 0.65, or 0.89 percent.

It has touched an intraday high of Rs 74.70 and an intraday low of Rs 72.40.

It was trading with volumes of 16,624 shares, compared to its thirty day average of 54,305 shares, a decrease of -69.39 percent.

In the previous trading session, the share closed up 2.09 percent or Rs 1.50 at Rs 73.40.

The share touched its 52-week high Rs 97.70 and 52-week low Rs 55.50 on 29 July, 2021 and 24 February, 2021, respectively.

Currently, it is trading 25.54 percent below its 52-week high and 31.08 percent above its 52-week low.

Market capitalisation stands at Rs 1,046.55 crore.

 For all recommendations report, click here

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