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INDUSTRY VALUATIONS

India Cement Industry peers are trading at 9.8x EV/E and USD 119/t on FY23E

PRICE TRENDS

All India Cement prices in Aug-21 changed -2% MoM, -4% QoQ, 1% 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 26%/59%/9% QoQ and 96%/90%/20% YoY

PER TONNE IMPACT

Expect Power costs to increase by INR 187/t and Freight cost by INR 36/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, Dalmia Bharat and JK Lakshmi

NEWS HIGHLIGHTS FROM THE WEEK

* JK cement plans to be 23MTPA player by 2023: JK Cement intends to increase capacity to 23MTPA in next two years from 15MTPA now by expanding footprint in North and central regions. Company has earmarked INR 29.7bn of capex for this project.

* Cement players to put 175MW of WHR in FY22: Major cement companies will invest INR 17bn in two fiscal years ending FY22 to set up 175MW of WHR capacity as per ICRA..

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