Shree Cement shares fell over 2% today after the cement maker reported a weak set of Q3 earnings. Profit fell 44% for the quarter ended December 2022. Shree Cement stock lost 2.15 per cent intraday to Rs 23,720 against the previous close of Rs 24,241 on BSE. Market cap of the firm fell to Rs 85,884 crore on BSE. The stock is down 6.45 per cent in a year and risen 2.44% in 2022. Total 471 shares of the firm changed hands amounting to a turnover of Rs 1.12 crore on BSE.
Shree Cement stock hit a 52-week high of Rs 26,332 on April 26, 2022 and a 52 week low of Rs ┬а17,900 on June 20, 2022.
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In terms of technicals, the relative strength index (RSI) of Shree Cement stands at 55.8, signaling it’s trading in neither oversold or overbought territory. ┬аThe stock has a beta of 0.9 indicating low volatility in a year. Shree Cement has a price to equity ratio of 62.61 compared to the industry PE of 27.27. The stock is trading higher than the 20 day, 100 day and 200 day moving averages but lower than 5 day and 50 day moving averages.
Shree Cement logged a 44% year-on-year (YoY) fall in its standalone profit to Rs 277 crore for the quarter ended December 31, 2022 against a net profit of Rs 492 crore in the corresponding quarter of the previous fiscal. Revenue from operations rose 15% YoY at Rs 4,069 crore in the December compared to Rs 3,552 crore in the year-ago period.
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) slipped 7% YoY to Rs 869 crore in Q3FY23 compared to Rs 936 crore in the same quarter of the previous year.
YES Securities has assigned a neutral rating to the stock with a target price of Rs 25,177 (3%) against the current price of Rs 25,177.
“The overall expansion will outlay Rs 67.5 bn over FY23-25E and will be funded through internal accruals. At the current market price , stock trades at 19/16x EV/EBITDA on FY24/25E. Therefore, by valuing the stock at 18x EV/EBITDA on FY25E arrived at a TP of Rs25,177 with a NEUTRAL rating,” the brokerage said.
Motilal Oswal too has assigned a neutral rating to the stock with a target price of Rs 22,410, down 8% ┬аfrom the current market price.
“We reduce our FY23 estimated EPS by 7.5% on weak 3QFY23 performance, while keeping our FY24/FY25 estimates intact. We expect SRCM’s cost benefits over peers to narrow gradually. The stock’s valuation at 20.4x FY24E EV/EBITDA appears rich and hence, we maintain our Neutral rating,” said the brokerage.
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