Star Cement Q2 Review - Recent Capacity Expansion To Drive Growth: Dolat Capital

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Dolat Capital Report

Star Cement Ltd. reported revenue and volume below; Ebitda/tonne and adjusted profit after tax above estimates however Ebitda and realisation were in line.

Star Cement posted muted set of numbers with up 1.2%/down 9.2%/down 22.8% YoY in revenue/Ebitda/adjusted profit after tax to Rs 4.1 billion/Rs 717 million/Rs 465 million led by up 5.3% growth in realisation offset by down 3.9% YoY volume. 

We expect 15.7%/17.3%/25.3% revenue/Ebitda/adjusted profit after tax compound annual growth rate over FY21-24E led by 22.0%/12.0%/9.0% volume growth and 4.0%/down 0.5%/down 0.5% realisation growth in FY22E/FY23E/FY24E. 

We broadly maintain revenue estimates and decrease Ebitda and adjusted profit after tax estimates by 7.7%/11.5% and 7.3%/10.5% for FY22E/FY23E respectively considering H1 FY22 results.

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Dolat Capital Star Cement Q2FY22 Result Update.pdf

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