Hold JK Cement, target price Rs 2800: Emkay Global Financial Services

Emkay Global Financial Services has hold call on JK Cement with a target price of Rs 2800. The current market price of JK Cement is Rs 3037.45. Time period given by analyst is 1 year when JK Cement price can reach defined target.

JK Cement Ltd., incorporated in the year 1994, is a Mid Cap company (having a market cap of Rs 23450.91 Crore) operating in Cement sector.

Financials

For the quarter ended 30-09-2022, the company has reported a Consolidated Total Income of Rs 2249.64 Crore, down -1.65 % from last quarter Total Income of Rs 2287.31 Crore and up 15.78 % from last year same quarter Total Income of Rs 1942.96 Crore. Company has reported net profit after tax of Rs 111.25 Crore in latest quarter.

The company’s top management includes Mrs.Sushila Devi Singhania, Mr.Saurabh Chandra, Mrs.Deepa Gopalan Wadhwa, Mr.Satish Kumar Kalra, Mr.Sudhir Jalan, Mr.Paul Heinz Hugentobler, Dr.K B Agarwal, Mr.Mudit Aggarwal, Mr.Nidhipati Singhania, Mr.Ajay Narayan Jha, Mr.Ajay Kumar Saraogi, Mr.Madhavkrishna Singhania, Mr.Raghavpat Singhania, Mr.Ashok Sinha. Company has S R Batliboi & Co. LLP as its auditors. As on 30-09-2022, the company has a total of 8 Crore shares outstanding.

Investment Rationale
The company's cash-flow generation will support its next leg of growth. Given its increased scale of operations, the brokerage expects the company's OCF to more than double in FY22-25E vs the average. Emkay remains structurally positive on the company. However, it maintains HOLD rating on the stock, as the risk-reward appears balanced post the 15% run up in the stock price in the past one month.

Promoter/FII Holdings
Promoters held 45.84 per cent stake in the company as of 30-Sep-2022, while FIIs owned 16.08 per cent, DIIs 21.9 per cent.