Motilal Oswal: JK Cement’s Capacity-Led Volume Growth To Drive Earnings

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Motilal Oswal Report.J K Cement Ltd.’s Q1 FY21 result highlights market share gains for the company, led by approximately 50% capacity expansion in North India.Volumes declined 19% YoY versus industry decline of approximately 30% YoY.Q1 FY21 revenue/Ebitda/profit after tax at Rs 9.7 billion/Rs 2.2 billion/Rs 0.8 billion was down 27%/ 29%/ 49% YoY and was up 2%/ up 29%/ up 57% against our estimate.Volumes declined for grey cement (including clinker) by 19% YoY to 1.59 million tonne and for white cement by 48% YoY to 0.18 million tonne.Total volumes fell 24% YoY to 1.77 million tonne (our estimate 1.73 million tonne).Blended realization fell 5% YoY to Rs 5,464/tonne (down 1% QoQ) (our estimate Rs 5,481/tonne) on a higher proportion of grey cement (90% versus 85%) in the sales mix.Total cost per ton declined 4% YoY (flat QoQ) to Rs 4,245/tonne and was 6% beat on our estimate due to a 27% YoY fall in other expenses from lower fixed overheads.However, decline was partly offset by negative operating leverage and the consumption of higher cost petcoke inventory..Click on the attachment to read the full report:.DISCLAIMERThis report is authored by an external party. BloombergQuint does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the brokerage and do not represent the views of BloombergQuint. .Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Motilal Oswal: JK Cement’s Capacity-Led Volume Growth To Drive Earnings

Motilal Oswal: JK Cement’s Capacity-Led Volume Growth To Drive Earnings

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