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India Equity Research Reports, IPO and Stock News
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M a r g i n s s u r g e o n c o s t s a v i n g s …
Mangalam Cement reported net sales of | 172 crore (up ~57% YoY,
~39% QoQ), which was below our estimate of | 190 crore on account of
lower than expected cement realisations. Realisations remained flat
sequentially at | 3399/tonne (our estimate: | 3720/tonne) due to higher
clinker sales in Q3FY12. The volume jumped sharply during the quarter
on the back of a pick-up in demand post monsoon. EBITDA margins of
22.9% and PAT of | 26 crore were above our respective estimates of
11.6% and | 12 crore, on account of lower-than-expected costs. Power &
fuel cost and raw material cost declined due to use of efficient fuel
(petcoke). EBITDA/tonne increased to | 779/tonne vs. our expectation of |
430/tonne. With the expansion of 1.25 MT at Aligarh (UP), total capacity
would reach 3.25 MT by FY13E end. We expect cement sales volumes of
1.74 MTPA in FY12E and 1.75 MTPA in FY13E against 1.61 MT in FY11.
ƒ Realisation up ~23% YoY, cement volumes up ~27% YoY
Cement sales volumes increased ~27% YoY and ~38% QoQ to 0.51
MT on a pick-up in demand post monsoon. Realisations increased
~23% YoY to | 3399/tonne on account of price hikes taken during
the quarter but remained flat QoQ due to higher clinker sales.
ƒ EBITDA/tonne jumps on higher realisation & lower costs
The EBITDA/tonne increased significantly to | 779/tonne, mainly on
account of higher realisation and lower costs. The P&F cost declined
due to the use of efficient fuel while the raw material cost declined
on the back of a reduction in proportion of high cost limestone.
V a l u a t i o n
At the CMP of | 140, the stock is trading at 6.3x and 6.0x its FY12E and
FY13E earnings, respectively. The stock is trading at an EV/EBITDA of 4.1x
and 5.3x FY12E and FY13E EBITDA, respectively. On an EV/tonne basis,
the stock is trading at $45 and $41 its FY12E and FY13E capacities of 2 MT
and 3.25 MT, respectively. We have valued the stock at $45/tonne its
FY13E capacity of 3.25 MT (~65% discount to the current replacement
cost). We have revised our target price to | 151/share with a HOLD rating.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
PDF LINK for report- click HERE
M a r g i n s s u r g e o n c o s t s a v i n g s …
Mangalam Cement reported net sales of | 172 crore (up ~57% YoY,
~39% QoQ), which was below our estimate of | 190 crore on account of
lower than expected cement realisations. Realisations remained flat
sequentially at | 3399/tonne (our estimate: | 3720/tonne) due to higher
clinker sales in Q3FY12. The volume jumped sharply during the quarter
on the back of a pick-up in demand post monsoon. EBITDA margins of
22.9% and PAT of | 26 crore were above our respective estimates of
11.6% and | 12 crore, on account of lower-than-expected costs. Power &
fuel cost and raw material cost declined due to use of efficient fuel
(petcoke). EBITDA/tonne increased to | 779/tonne vs. our expectation of |
430/tonne. With the expansion of 1.25 MT at Aligarh (UP), total capacity
would reach 3.25 MT by FY13E end. We expect cement sales volumes of
1.74 MTPA in FY12E and 1.75 MTPA in FY13E against 1.61 MT in FY11.
ƒ Realisation up ~23% YoY, cement volumes up ~27% YoY
Cement sales volumes increased ~27% YoY and ~38% QoQ to 0.51
MT on a pick-up in demand post monsoon. Realisations increased
~23% YoY to | 3399/tonne on account of price hikes taken during
the quarter but remained flat QoQ due to higher clinker sales.
ƒ EBITDA/tonne jumps on higher realisation & lower costs
The EBITDA/tonne increased significantly to | 779/tonne, mainly on
account of higher realisation and lower costs. The P&F cost declined
due to the use of efficient fuel while the raw material cost declined
on the back of a reduction in proportion of high cost limestone.
V a l u a t i o n
At the CMP of | 140, the stock is trading at 6.3x and 6.0x its FY12E and
FY13E earnings, respectively. The stock is trading at an EV/EBITDA of 4.1x
and 5.3x FY12E and FY13E EBITDA, respectively. On an EV/tonne basis,
the stock is trading at $45 and $41 its FY12E and FY13E capacities of 2 MT
and 3.25 MT, respectively. We have valued the stock at $45/tonne its
FY13E capacity of 3.25 MT (~65% discount to the current replacement
cost). We have revised our target price to | 151/share with a HOLD rating.
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