India Cements - Q4 FY20 (Audited –Cons) CMP: 126
Total revenue from operations 1,176 Cr 1,603 Cr (-26.61%) YoY | 1,244 Cr (-5.45%) QoQ
Year ending revenue: 5,186 Cr Vs. 5,770 Cr (-10.14%)
Net Profit of (11.7) Cr 32.57 Cr (135.92%) YoY (9.43) Cr (-24.39%) QoQ
Year ending Net profit: 53.46 Cr Vs. 25.26 Cr (111.61%)
EPS (in Rs.) 7.16 0.53 YoY |( 0.24) QoQ
Year ending EPS: 9.18 Vs. 0.28
View: Result is below expectations. YoY revenue declined and the company also posted losses in this quarter and FY20 also posted losses in this quarter. Due to the comprehensive Income, the EPS is positive for Q4 and FY20.
Business Updates & Highlights:
Q4FY20 EBITDA is around INR 72.1 Cr Vs. 187.4 Cr in Q4FY19 Vs. 129.9 Cr in Q3FY20, therefore, declined by 61.5% in YoY and declined by 44.5% in QoQ. The EBITDA margin is around 6.1% Vs. 11.6% Vs. 10.4%.
FY20 EBITDA is around INR 594.6 Cr Vs. 640.1 Cr in FY19 therefore up by 7.1% in YoY. The EBITDA margin is around 11.4% Vs. 11.1% in FY19.
Board of Directors of the Company at its meeting held on June 24, 2020, inter alia, has recommended a dividend of Re. 0.60 per share for the year ended March 31, 2020
Financial
ROE and ROCE is around INR 0.3% and 5% respectively and book value per share is around INR 170 and share is currently trading at 0.8x of its book value. The company is currently trading at annualized PE of 15 which is fair as per Industry benchmark. Promoter holding is around 28.2% in the company which is very low and also promoter has pledged around 27% of their shareholding (Very negative). FIIs, mutual fund, and insurance cos hold around 12.2%, 2.7% and 5.3% in the company which is decreased by FIIs and mutual fund. Cash and cash equivalent from operating activities as of March 2020 is around INR 386 Cr Vs. 377 Cr as of March 2019.
Position: Share support price is INR 100. Trading based share and the risky trader can continue.
Share View: Share price high 140 (52 weeks) and now 126. India Cements is one of the leading cement manufacturing companies in India and also a market leader in South India. The total capacity of 15.5 million tonnes per annum
Opportunities: Leading cement player in South India. Recently HNIs Damani has invested in the share at lower rate around INR 85-100 and currently continue to hold and as per market rumours it can be taken over by Damani also since promoter shareholding is too low although company has denied this rumours. The company is also holding premier IPL Team Chennai Super King.
Risk: Q1FY21 will be more down due to their subsidiary business Chennai Super King no IPL revenue since the postponement of IPL on account of COVID – 19 mostly IPL revenue recorded in Q1. Further due to shut down also topline can further impact.
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Total revenue from operations 1,176 Cr 1,603 Cr (-26.61%) YoY | 1,244 Cr (-5.45%) QoQ
Year ending revenue: 5,186 Cr Vs. 5,770 Cr (-10.14%)
Net Profit of (11.7) Cr 32.57 Cr (135.92%) YoY (9.43) Cr (-24.39%) QoQ
Year ending Net profit: 53.46 Cr Vs. 25.26 Cr (111.61%)
EPS (in Rs.) 7.16 0.53 YoY |( 0.24) QoQ
Year ending EPS: 9.18 Vs. 0.28
View: Result is below expectations. YoY revenue declined and the company also posted losses in this quarter and FY20 also posted losses in this quarter. Due to the comprehensive Income, the EPS is positive for Q4 and FY20.
Business Updates & Highlights:
Q4FY20 EBITDA is around INR 72.1 Cr Vs. 187.4 Cr in Q4FY19 Vs. 129.9 Cr in Q3FY20, therefore, declined by 61.5% in YoY and declined by 44.5% in QoQ. The EBITDA margin is around 6.1% Vs. 11.6% Vs. 10.4%.
FY20 EBITDA is around INR 594.6 Cr Vs. 640.1 Cr in FY19 therefore up by 7.1% in YoY. The EBITDA margin is around 11.4% Vs. 11.1% in FY19.
Board of Directors of the Company at its meeting held on June 24, 2020, inter alia, has recommended a dividend of Re. 0.60 per share for the year ended March 31, 2020
Financial
ROE and ROCE is around INR 0.3% and 5% respectively and book value per share is around INR 170 and share is currently trading at 0.8x of its book value. The company is currently trading at annualized PE of 15 which is fair as per Industry benchmark. Promoter holding is around 28.2% in the company which is very low and also promoter has pledged around 27% of their shareholding (Very negative). FIIs, mutual fund, and insurance cos hold around 12.2%, 2.7% and 5.3% in the company which is decreased by FIIs and mutual fund. Cash and cash equivalent from operating activities as of March 2020 is around INR 386 Cr Vs. 377 Cr as of March 2019.
Position: Share support price is INR 100. Trading based share and the risky trader can continue.
Share View: Share price high 140 (52 weeks) and now 126. India Cements is one of the leading cement manufacturing companies in India and also a market leader in South India. The total capacity of 15.5 million tonnes per annum
Opportunities: Leading cement player in South India. Recently HNIs Damani has invested in the share at lower rate around INR 85-100 and currently continue to hold and as per market rumours it can be taken over by Damani also since promoter shareholding is too low although company has denied this rumours. The company is also holding premier IPL Team Chennai Super King.
Risk: Q1FY21 will be more down due to their subsidiary business Chennai Super King no IPL revenue since the postponement of IPL on account of COVID – 19 mostly IPL revenue recorded in Q1. Further due to shut down also topline can further impact.
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