At Rs 6.5 billion (Citi Rs 6.9 billion), Q1 adjusted Ebitda fell 10% year-on-year \u2014 volume growth and higher power Ebitda offset by lower realisation and higher costs. Cement Ebitda\/t: Rs 860 against Rs 1,215 last year and Rs 955 in Q4. Volumes rose ~19% year-on-year \u2014 strong growth in both regions (East > North). Capacity mix: North 75%, East 25%. With the commissioning of ~9 MT of capacities in the East, North and South during February-June 18, Shree\u2019s capacity is now ~38 MT. According to reports (Livemint), Shree has plans to set up grinding units (7-8 MTPA) in Odisha, Jharkhand, WB (East) and Maharashtra (West). Citi volume estimate: FY19 +18%, FY20 +18%. Shree has completed the acquisition of 97.6% of the United Cement Company (UAE) \u2014 4 MTPA cement, 3.3 MTPA clinker. This compares to ACC at +5% and Ambuja\/ULTC at +2%. The weakness against peers is attributed to higher exposure in the North \u2014 both ULTC and Ambuja suggested muted pricing in the North. Shree management also indicated that prices were weaker quarter-on-quarter in the North, stronger in the East. Current prices are higher than the June average in both regions. 1) Freight (~35% of total) rose 14% year-on-year \u2014 higher diesel prices. 2) Power\/fuel (~30%) rose ~31% year-on-year \u2014 surge in petcoke prices. Other expenses include an FX loss of Rs 700 million on unhedged debt. We expect higher axle weight to benefit freight; we await clarity. 1) Potential pricing upside, 2) Cost likely close to peak; benefit of higher axle loading going forward, 3) Strong volumes. Cut FY19-21 Ebitda by 6-12% on lower realisations. We value Shree at 15x EV\/Ebitda (against 16x earlier) roll fwd to Mar 20 from Sep 19; adjust for UAE acquisition. Top picks: Ambuja and ULTC (additionally we have opened a 90-day catalyst watch on ACC).