Buy Prism Johnson, target price Rs 152: ICICI Securities

ICICI Securities has buy call on Prism Johnson with a target price of Rs 152. The current market price of Prism Johnson Ltd. is Rs 134.35. Time period given by analyst is one year when Prism Johnson Ltd. price can reach defined target.

Prism Johnson Ltd., incorporated in the year 1992, is a Mid Cap company (having a market cap of Rs 6770.15 Crore) operating in Cement sector.

Financials
For the quarter ended 30-06-2021, the company reported a Consolidated Total Income of Rs 1316.87 Crore, down -29.29 % from last quarter Total Income of Rs 1862.48 Crore and up 51.25 % from last year same quarter Total Income of Rs 870.64 Crore. Company reported net profit after tax of Rs -4.31 Crore in latest quarter.


Investment Rationale
Prism Johnson’s (PRSMJ) Q1FY22 standalone EBITDA grew 3.2x YoY to Rs1.5bn, broadly in line with our and consensus estimates. Cement volumes declined 30% QoQ owing to covid resurgence; however realisation grew 5.4% QoQ resulting in EBITDA/te increasing 32% QoQ to Rs1,156/te. PRSMJ would be expanding its cement capacity by 1.9mnte in two phases by Sep’23 and tile capacity by 8.5msm by Mar’23 providing improved revenue visibility. Besides, consolidated net debt is likely to reduce from Rs12.3bn in Mar’21 to ~Rs8.3bn by Mar’23. It broadly maintains FY23E EBITDA and raise our target price to Rs152/sh (earlier: Rs150), based on 8x Jun’23E EV/E on quarterly rollover.

Promoter/FII Holdings
Promoters held 74.9 per cent stake in the company as of June 30, 2021, while FIIs held 3.3 per cent, DIIs 7.4 per cent and public and other 14.4 per cent.