Add Star Cement, target price Rs 115: HDFC Securities
Star Cement, incorporated in the year 2001, is a Mid Cap company (having a market cap of Rs 4623.82 Crore) operating in Cement sector.
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HDFC Securities has add call on Star Cement with a target price of Rs 115. The current market price of Star Cement is Rs 114.1.
Star Cement, incorporated in the year 2001, is a Mid Cap company (having a market cap of Rs 4623.82 Crore) operating in Cement sector.
Star Cement key Products/Revenue Segments include Cement, Scrap and Other Operating Revenue for the year ending 31-Mar-2022.
Financials
For the quarter ended 31-12-2022, the company has reported a Consolidated Total Income of Rs 631.27 Crore, up 3.87 % from last quarter Total Income of Rs 607.76 Crore and up 12.34 % from last year same quarter Total Income of Rs 561.93 Crore. Company has reported net profit after tax of Rs 52.87 Crore in latest quarter.
The company’s top management includes Mr.Sajjan Bhajanka, Mr.Nirmalya Bhattacharyya, Ms.Ibaridor Katherine War, Mr.Plistina Dkhar, Mr.Amit Kiran Deb, Mr.Deepak Singhal, Mr.Pramod Kumar Shah, Mr.Pankaj Kejriwal, Mr.Prem Kumar Bhajanka, Mr.Sanjay Agarwal, Mr.Rajendra Chamaria, Mr.Brij Bhushan Agarwal. Company has D K Chhajer & Co. as its auditors. As on 31-12-2022, the company has a total of 40 Crore shares outstanding.
Investment Rationale
Star has reported muted volume growth of 4% YoY (reduced sales in low-contributing markets). Unit EBITDA recovered ~INR 415/MT QoQ to Rs 1194/MT (industry best for the third consecutive quarter!) on better realisation, low input cost, lower freight cost and op-lev gains. Star will be commissioning 12MW WHRS in Q4FY23, which will offset the impact of GST incentive expiration. Star’s ongoing expansion will increase capacity by 70% to 9.7mn MT by H1FY25E, which will increase net Debt/EBITDA to 2-2.5x during FY24/25E.
Promoter/FII Holdings
Promoters held 67.03 per cent stake in the company as of 31-Dec-2022, while FIIs owned 0.53 per cent, DIIs 6.15 per cent.
Star Cement, incorporated in the year 2001, is a Mid Cap company (having a market cap of Rs 4623.82 Crore) operating in Cement sector.
Star Cement key Products/Revenue Segments include Cement, Scrap and Other Operating Revenue for the year ending 31-Mar-2022.
Financials
For the quarter ended 31-12-2022, the company has reported a Consolidated Total Income of Rs 631.27 Crore, up 3.87 % from last quarter Total Income of Rs 607.76 Crore and up 12.34 % from last year same quarter Total Income of Rs 561.93 Crore. Company has reported net profit after tax of Rs 52.87 Crore in latest quarter.
The company’s top management includes Mr.Sajjan Bhajanka, Mr.Nirmalya Bhattacharyya, Ms.Ibaridor Katherine War, Mr.Plistina Dkhar, Mr.Amit Kiran Deb, Mr.Deepak Singhal, Mr.Pramod Kumar Shah, Mr.Pankaj Kejriwal, Mr.Prem Kumar Bhajanka, Mr.Sanjay Agarwal, Mr.Rajendra Chamaria, Mr.Brij Bhushan Agarwal. Company has D K Chhajer & Co. as its auditors. As on 31-12-2022, the company has a total of 40 Crore shares outstanding.
Investment Rationale
Star has reported muted volume growth of 4% YoY (reduced sales in low-contributing markets). Unit EBITDA recovered ~INR 415/MT QoQ to Rs 1194/MT (industry best for the third consecutive quarter!) on better realisation, low input cost, lower freight cost and op-lev gains. Star will be commissioning 12MW WHRS in Q4FY23, which will offset the impact of GST incentive expiration. Star’s ongoing expansion will increase capacity by 70% to 9.7mn MT by H1FY25E, which will increase net Debt/EBITDA to 2-2.5x during FY24/25E.
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Promoter/FII Holdings
Promoters held 67.03 per cent stake in the company as of 31-Dec-2022, while FIIs owned 0.53 per cent, DIIs 6.15 per cent.
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