Sagar Cements Q4 Results Review - Lower Profitability Remains A Concern: Dolat Capital

"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..Dolat Capital Report.Sagar Cements Ltd.’s Q4 FY24 volume/revenue/adjusted profit after tax came in-line, however realisation, Ebitda and Ebitda/tonne were below estimates. Revenue grew by 14.0% YoY to Rs 7.1 billion (+5.9% QoQ) led by volume growth of 18.9% YoY to 1.6 million tonne (+14.7% QoQ), partially offset by -4.1% YoY in realisation/tonne to Rs 4,392 (- 7.7% QoQ). Ebitda grew +75.3% YoY/-21.7% QoQ to Rs 681 million. Adjusted net loss stood at Rs 123 million versus Rs 775 million YoY. The company targets volume of 6.5 mt (versus earlier guidance of 7 mt) for FY25E. We expect revenue/Ebitda compound annual growth rate 13.9%/34.7% over FY24-26E led by 16.4%/15.2% volume growth and -5%/+1% blended realization growth in FY25E/FY26E. However, we expect improvement in net loss at ~Rs 117 million in FY26E versus Rs 837 million net loss in FY24..We are positive on Sagar Cements' strong fundamentals driven by-its positioning as a low-cost cement producer, achieved through various cost rationalising measures andits constant efforts to expand capacity and diversify revenue streams.However, we decrease our FY25E/FY26E Ebitda estimates by 38.6%/25.9% post factoring lower volume coupled with lower realisation and also expect Ebitda/tonne of Rs 508/Rs 604 for the same period. Accordingly, we downgrade to ‘Sell’ rating from Accumulate with revised target price of Rs 186 based on 7.5 times consolidated FY26E enterprise value/Ebitda plus Vizag land monetization at Rs 49/share (Rs 6.4 billion)..Click on the attachment to read the full report:.Shree Cement Q4 Results Review - Traction In H2: IDBI Capital .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."

Sagar Cements Q4 Results Review - Lower Profitability Remains A Concern: Dolat Capital

Continuous capex to increase net debt

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