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Systematix Report
According to Systemtix. Shree Cement Ltd. remains well-positioned with strong volume growth and ongoing capacity expansion, though near-term margins may stay under pressure due to elevated costs.
The company is regaining market share as seen in its strong volume growth which is a sign of relief.
At 16x/13.3x FY27E/FY28E EV/Ebitda, valuations appear attractive; thus the brokerage has kept target price almost unchanged at Rs 29,185 (16x FY28E EV/Ebitda) and upgrade Shree Cement to Buy from Hold.
Shree Cement Q4 Results
Shree Cement reported a healthy set of numbers in Q4 FY26 as revenue beat estimate driven by stronger-than-expected volumes and improved realizations while Ebitda/PAT were largely in line.
Standalone revenue was up 7.7% YoY (27.8% QoQ) to Rs 5,640 crore vs brokerage's estimate of Rs 5,140 crore.
Volumes grew by 9.5% YoY to ~10.8 mt above expectations of 10mt. Blended realization witnessed an improvement of 6% sequentially to Rs 5,240/tn. However, profitability was impacted by cost pressures. Ebitda declined 9.5% YoY to Rs 1,250 croren, with Ebitda/tonne down 16% YoY to Rs 1,179, primarily due to higher input costs and relatively weaker YoY realizations.
On a per-ton basis, raw material and freight costs rose sharply by 34% and 6.6% to Rs 761 and Rs 1,252, respectively, partially offset by declines in employee and other expenses (~8% and 10.6%).
Lead distance for Q4 FY26 was 457kms vs 446kms in Q4 FY25.
Green Power share for the quarter is 61%, the best among its peers. PAT stood at Rs 530 crore, a 4% decline YoY mainly due to higher costs and depreciation.
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