Cement pricing lacking momentum: Citi

Dec 09 2013, 13:26 IST
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Demand remains muted on poor pre-election spend Demand remains muted on poor pre-election spend
SummaryDemand remains muted on poor pre-election spend

16.6x P/E (price-to-earnings ratio) and an EV/t of $134 (on 57mtpa of capacity, R/$ rate at 60) vs. replacement cost of $110/tonne.

Risks: A 1% change in cement realizations impacts profit after tax by 5%; 1% change in cement volumes would impact PAT by 2%. Upside risks that could sustain the shares above our target price include better production discipline, higher price hikes, stronger demand, or lower costs vs. expectations.

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