Cement News

JK Cement Q2 Results Review

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BQ Prime’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 BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. 

JK Cement Ltd.’s (standalone) reported volume, revenue, realisation in line, however Ebitda, Ebitda/tonne and adjusted profit after tax above estimates.

JK Cement posted up 16.7% YoY growth in standalone revenue to Rs 21.4 billion in Q2 FY23 led by up 9.4% YoY (up 2.3% QoQ) in volume to 3.64 million tonne coupled with up 6.7% YoY (down 3.4% QoQ) in realisation/tonne to Rs 5,878.

Ebitda/adjusted profit after tax down 9.8%/ down 26% YoY to Rs 3.0 billion/ Rs 1.2 billion due to poor operating performance.

We expect 16.2%/ 17.9%/ 18.3% revenue/ Ebitda/adjusted profit after tax compound annual growth rate over FY22-25E led by 11.0%/ 20.1%/ 14.1% volume growth and 5.7%/ down 1.6%/ -0.8% cement realisation growth in FY23E/ FY24E/ FY25E.

We have switched to evaluating the company on its consolidated financials to reflect the expansion in its subsidiary. Thus, change in estimates is not comparable, though we broadly maintain revenue/ Ebitda estimates for FY23E/ FY24E and introduce FY25E.

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