Reduce Shree Cement; target of Rs 20,900: HDFC Securities

HDFC Securities' research report on Shree Cement

Shree Cement’s (SRCM) standalone revenue/EBITDA fell 23/22% YoY to Rs 23.26/7.01bn, and APAT grew 2% YoY to Rs 3.71bn. It reported lower-than-estimated EBITDA in 1QFY21, on slower NSR gain QoQ. Unitary EBITDA cooled off 9% QoQ (-1% YoY) to Rs 1,421/MT. The COVID impact also led to an EBITDA loss at the UAE subsidiary.

Outlook

Despite the volume decline in FY21E, we expect SRCM’s standalone margin to expand on stable realisation and lower input costs. We maintain our REDUCE rating with an unchanged target price of Rs 20,900.

For all recommendations report, click here

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