Cement Sector Update - India Cement Industry peers are trading at 9.4x EV/E and USD 123/t on FY23E By JM Financial
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TABLE OF CONTENTS
INDUSTRY VALUATIONS
India Cement Industry peers are trading at 9.4x EV/E and USD 123/t on FY23E
PRICE TRENDS
All India Cement prices in Sep-21 changed 0% MoM, -5% QoQ, 2% YoY
VOLUME TRENDS
Industry production in Jul’21 was 28.3mnT; 16.6% MoM, 7.5% YoY
COST COMPONENT TRENDS
Petcoke/Coal/Diesel prices have changed by 23%/53%/7% QoQ and 92%/100%/20% YoY
PER TONNE IMPACT
Expect Power costs to increase by INR 174/t and Freight cost by INR 29/t QoQ
QUARTERLY MATRIX
Volumes are up 44% YoY; Realisation are up 6.7% QoQ; EBITDA/t is up 4.9% YoY in 1Q
DEMAND TRENDS
We expect 10-12% growth in cement volumes in FY22E
TOP PICKS
We are positive on Ultratech and Dalmia Bharat
NEWS HIGHLIGHTS FROM THE WEEK
CLICK HERE FOR LAST REPORT - Shree announces 6.5MTPA expansion: Shree has announced a 6.5MTPA of capacity addition through greenfield expansion across northern and eastern regions. This will increase Shree’s total capacity to c.53MTPA by FY24 end.
Project is expected to cost INR 42.5bn. -Dalmia started production from line2 at Odisha: Dalmia Cement has commenced commercial production from the second line (Line 2) having a capacity of 2.25 million tonnes at its Kapilas Cement Manufacturing Works (KCMW) unit near Cuttack in Odisha.
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