'Add' Cera Sanitaryware Shares Maintains PL Capital Post Q1 Results — Check Target Price

Cera reported 5.4% growth in revenue with ~140 bps contraction in Ebitda margin due to increase in employee cost and B2B contribution. Cera aims to outperform the industry by 6-7%, with Ebitda margin of 15-16% by the end of FY26.

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PL Capital Report

Cera Sanitaryware Ltd. has reported modest results amid the weak demand scenario. The B2B segment showed improved momentum in the quarter, partially offsetting slower demand in the retail space for Cera.

Cera reported 5.4% growth in revenue with ~140 bps contraction in Ebitda margin due to increase in employee cost and B2B contribution. Cera aims to outperform the industry by 6-7%, with Ebitda margin of 15-16% by the end of FY26.

The company continues to hold off its sanitaryware expansion plans until the demand environment improves. We estimate revenue/ Ebitda/PAT CAGR of 11.4%/12.2%/10.7% over FY25-27E.

We downward revise FY26/FY27E earnings estimate by 1.9%/2.8% and reduce target price to Rs 7,178 (Rs 7,389 earlier), based on 30x FY27E earnings. Maintain ‘Accumulate’ rating.

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