'Buy' JK Cement Shares Maintains Motilal Oswal — Here's Why

JK Cement saw re-rating in FY22, and started trading at average EV/Ebitda (one-year forward) of 17 times. Re-rating in the stock is attributable to its expanded operations, strong execution capabilities, and cost-reduction initiatives..NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Motilal Oswal Report.We estimate JK Cement Ltd. to generate a cumulative operating cash flow of Rs 81.0 billion during FY26-28, and its cumulative capex would be Rs 48.0 billion over the same period. Given the strong cash flow generation and low-cost expansions (capex cost stood at $60-70/tonne), we believe its net debt will peak out in FY26E at Rs 42 billion. Further, its net debt-to-Ebitda ratio would decline to <1.0x in FY28E from 2.0x in FY25. We estimate its RoE/RoCE (post-tax) to improve to ~19%/13% in FY27 from ~13%/10% in FY25.JK Cement saw re-rating in FY22, and started trading at average EV/Ebitda (one-year forward) of 17 times. Re-rating in the stock is attributable to its expanded operations, strong execution capabilities, and cost-reduction initiatives. We believe JK Cement is best-placed among mid-size cement companies with a pan-India presence. Our Ebitda estimates for FY26/FY27/FY28 are higher by ~4%/1%/5% than the consensus estimates for JKCE. It is currently trading at 19x/16x FY26/FY27E EV/Ebitda and EV/T of $185/$180. We value JK Cement at 18x Jun’27E EV/Ebitda (premium to its long-term average) to arrive at a target price of Rs 7,250. We reiterate our Buy rating on the stock..Click on the attachment to read the full report:.Lodha Developers Can Rally 36% Says Motilal Oswal Maintaining 'Buy'.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

'Buy' JK Cement Shares Maintains Motilal Oswal — Here's Why

Motilal Oswal reiterates Buy rating on JK Cement with a target price of Rs 7,250

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