(Reuters) – India’s JK Lakshmi Cement reported a 52% drop in third-quarter profit on Thursday, hurt by a drop in prices of the construction material.
The company’s standalone net profit after tax fell to 596.4 million rupees ($6.8 million) in the quarter from 1.24 billion rupees a year ago.
Revenue from operations fell 13.4% to 13.73 billion rupees.
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KEY CONTEXT
Cement prices have been falling for most of last year, including a 11% on-year drop in the last quarter, which is also a seasonally weak one as the pace of construction activity slackens.
Cement makers so far have reported a mixed set of earnings. Market leader UltraTech and its closest rivals, the Adani group-owned Ambuja and ACC, have benefitted as their acquisition spree helped bolster volumes.
However, smaller companies such as Shree Cement and Dalmia Bharat succumbed to low prices.
PEER COMPARISON (WITH OTHER CEMENT MAKERS IN KEY NORTH, EAST REGIONS)
Valuation (next 12 Estimates (next 12 Analysts’ sentiment
months) months)
RIC PE EV/EBITDA Revenue Profit Mean No. of Stock to Div
growth (%) growth rating* analyst price yield
(%) s target** (%)
JK Lakshmi Cement 23.99 10.09 12.67 42.45 Buy 11 0.92 0.83
Shree Cement 57.36 20.64 13.11 39.16 Hold 18 1.04 0.37
Dalmia Bharat 36.30 11.84 8.83 41.50 Hold 28 0.99 0.48
Nuvoco Vistas 54.07 9.95 7.68 1477.99 Hold 16 0.95 –
Corporation
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell ** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
OCTOBER-DECEMBER STOCK PERFORMANCE
— All data from LSEG — $1 = 87.5510 Indian rupees
(Reporting by Hritam Mukherjee in Bengaluru; Editing by Savio D’Souza)
