Birla Corp Q3 Results Review - Cost Management, Pricing Aids Ebitda Growth: Nirmal Bang

Nirmal Bang Report

Birla Corporation Ltd.'s revenue for Q3 FY24 was higher by ~15% YoY (actual/estimated: Rs 23,120 million/Rs 22,793 million) due to volume growth of around ~13% YoY (actual/estimated: 4.2 million tonne/4.3 mt).

Full ramp up of Mukutban will accelerate volume expansion by getting access to newer, more profitable markets in Maharashtra and Gujarat.

The firm has taken major steps to improve operating efficiency, including sourcing raw materials like fly ash and limestone, using coal from its captive mine, and expanding captive power consumption to include solar and waste heat recovery.

We retain our 'Buy' recommendation for Birla Corp and value it at eight times December-25E enterprise value/Ebitda, with a revised target price of Rs 1,841.

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