Reduce Heidelberg Cement; target of Rs 160: HDFC Securities

HDFC Securities' research report on Heidelberg Cement

In the absence of any major planned expansion for the next four years, we expect the subdued volume growth and market share loss to continue, as other players are expanding in HEIM’s core markets. HEIM reported weak results in Q3FY23 due to continued volume decline (down 3% YoY) and NSR falling 2.5% QoQ. Unit EBITDA declined ~INR 135/MT QoQ to INR 339/MT (9-year low) entirely due to lower realisation, as opex stood flat QoQ.

Outlook

We maintain our REDUCE rating on Heidelberg Cement (HEIM), with a lower target price of INR 160/share (7x Mar-25E EBITDA).