Ramco Cements Misses On Volumes, Margins In Q3: Prabhudas Lilladher
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Prabhudas Lilladher Report
The Ramco Cements Ltd.’s reported Ebitda below our and consensus estimates by 12%/3% due to weaker than expected volumes and realisations.
We remain negative on Southern region due to over capacity and volatile demand pattern. As demand outlook improves for the region, volume growth would come at the cost of weaker margins due to rise in competition for market share and low capacity utilisation.
The same has played out in FY18- FY20, FY13-FY15 and FY09-FY11.
Secondly, the company’s earnings profile would deteriorate with increasing exposure to low margin and volatile markets of Andhra Pradesh /Telangana and East regions.
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