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L o w e r r e a l i s a t i o n h u r ts m a r g i n s …
JK Lakshmi Cement reported net sales of | 354 crore (up ~33% YoY and
down ~10% QoQ) and net profit of | 6.5 crore (up ~13% YoY and down
~71% QoQ). These were above our respective estimates of | 320 crore
and net loss of | 13 crore on account of higher-than-expected cement
volume at 1.13 MT against our estimate of 0.96 MT and higher-thanexpected realisation at | 3148/tonne against our estimate of | 3023/tonne.
The EBITDA/tonne improved ~25% YoY to | 366/tonne in Q2FY12 but
declined ~44% QoQ. We expect volume growth at ~8% CAGR over
FY11-13E with ~5 MT in FY13E from 4.3 MT in FY11 on account of an
improvement in utilisation rates. We estimate an EBITDA/tonne of | 546 in
FY12E and | 588 in FY13E against | 451 in FY11.
ƒ Net realisation down ~9% QoQ, volume up ~19% YoY (flat QoQ)
Blended cement sales volumes increased ~19% YoY to 1.13 MT but
remained flat QoQ. The cement realisation increased ~12% YoY
(declined ~9% QoQ) to | 3148/tonne due to a correction in cement
prices across its selling markets during the quarter.
ƒ EBITDA declines ~44% QoQ to | 366/tonne on lower realisation
The EBITDA/tonne has declined ~44% YoY to | 366 on the back of a
decline in realisation, which negated the impact of a decline in the
power & fuel, freight and other costs. On a YoY basis, the
EBITDA/tonne has improved ~25% on higher realisation.
V a l u a t i o n
At the CMP of | 43, the stock is trading at 6.8x and 5.6x its FY12E and
FY13E earnings, respectively. The stock is trading at an EV/EBITDA of 5.8x
and 6.6x FY12E and FY13E EBITDA, respectively. On an EV/tonne basis,
the stock is trading at $58 and $52 its FY12E and FY13E capacities of 5.4
MT and 8.1 MT, respectively. We have valued the stock at $60/tonne its
FY13E capacity of 8.1 MT, which is ~53% discount to the current
replacement cost of $130/tonne. We have maintained our BUY rating on
the stock with a target price of | 61/share.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
L o w e r r e a l i s a t i o n h u r ts m a r g i n s …
JK Lakshmi Cement reported net sales of | 354 crore (up ~33% YoY and
down ~10% QoQ) and net profit of | 6.5 crore (up ~13% YoY and down
~71% QoQ). These were above our respective estimates of | 320 crore
and net loss of | 13 crore on account of higher-than-expected cement
volume at 1.13 MT against our estimate of 0.96 MT and higher-thanexpected realisation at | 3148/tonne against our estimate of | 3023/tonne.
The EBITDA/tonne improved ~25% YoY to | 366/tonne in Q2FY12 but
declined ~44% QoQ. We expect volume growth at ~8% CAGR over
FY11-13E with ~5 MT in FY13E from 4.3 MT in FY11 on account of an
improvement in utilisation rates. We estimate an EBITDA/tonne of | 546 in
FY12E and | 588 in FY13E against | 451 in FY11.
ƒ Net realisation down ~9% QoQ, volume up ~19% YoY (flat QoQ)
Blended cement sales volumes increased ~19% YoY to 1.13 MT but
remained flat QoQ. The cement realisation increased ~12% YoY
(declined ~9% QoQ) to | 3148/tonne due to a correction in cement
prices across its selling markets during the quarter.
ƒ EBITDA declines ~44% QoQ to | 366/tonne on lower realisation
The EBITDA/tonne has declined ~44% YoY to | 366 on the back of a
decline in realisation, which negated the impact of a decline in the
power & fuel, freight and other costs. On a YoY basis, the
EBITDA/tonne has improved ~25% on higher realisation.
V a l u a t i o n
At the CMP of | 43, the stock is trading at 6.8x and 5.6x its FY12E and
FY13E earnings, respectively. The stock is trading at an EV/EBITDA of 5.8x
and 6.6x FY12E and FY13E EBITDA, respectively. On an EV/tonne basis,
the stock is trading at $58 and $52 its FY12E and FY13E capacities of 5.4
MT and 8.1 MT, respectively. We have valued the stock at $60/tonne its
FY13E capacity of 8.1 MT, which is ~53% discount to the current
replacement cost of $130/tonne. We have maintained our BUY rating on
the stock with a target price of | 61/share.
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