Somany Ceramics Q3 Review — Benign Show As Expected, Lucrative Valuations Drives 'Buy', Says Yes Securities

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Yes Securities Report

Subdued demand scenario keeps Somany Ceramics Ltd. performance under pressure. Company’s tiles revenue grew marginally by 3.5%YoY to Rs 5.46 billion wherein volumes increased by 4.5%YoY and realisations remained flattish over similar period. However, volume and revenue numbers were marginally better than our estimates.

Operating margins for the quarter stood at 8.3% versus estimate of 8.4% and as compared to 9.6%/8.4% margins in Q3 FY24/Q2 FY25 respectively. Lower volume off-take and reduction in average selling price weighed on operating margins.

Net profit de-grew sharply largely due to higher tax rates which as %PBT came in at 39% versus 31%/30% in Q3 FY24/Q2 FY25 respectively. Bathware biz revenue increased by 9%YoY to Rs 710 million.

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