Shree Cement Q2 Results Review - Volume Performance Disappoints; Downgrade To 'Hold': Systematix

Systematix Research Report

Through its focus on energy efficiency and cost optimisation, Shree Cement Ltd. registered one of the highest Ebitda/tonne of Rs 780. The company continues to focus on expanding its premium product sales as well as branding activities to garner market share.

While Shree Cement is well positioned to gain from its progressively diversified presence, focus on cost excellence as well as market positioning, we remain cautious as the company risks losing volume share in core markets to the top two players.

The stock is trading at 21.3 times/14.6 times FY25E/FY26E EV/Ebitda. We revise our target price to Rs 27,185 (previous Rs 30,050) based on an EV/Ebitda multiple of 17 times. We downgrade the stock to Hold (previous Buy).

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