(Reuters) – India’s Shree Cement reported a slump third-quarter profit on Thursday, hurt by weak prices and a slowdown in activity in a seasonally weak period.
The company’s consolidated net profit plunged 72.5% to 1.93 billion rupees ($22.3 million) in the quarter ended Dec. 31.
Total revenue from operations dropped 12% to 45.73 billion rupees.
KEY CONTEXT
Cement prices have been falling for most of last year, including a 11% on-year drop in the December quarter, which is also a seasonally weak one as the pace of construction activity slows.
However, market leader UltraTech and its closest rivals, Adani Group-owned Ambuja and ACC, benefitted as their acquisition spree helped bolster volumes.
However, while UltraTech and ACC reported upbeat results, smaller companies such as Dalmia Bharat and Orient Cement succumbed to low prices.
PEER COMPARISON
Estimates (next 12 Analysts’ sentiment
months)
RIC EV/EBI Revenue Profit Mean # of Stock to Div
TDA growth growth rating* analysts price yield
(%) (%) target** (%)
Shree Cement 18.28 8.20 20.32 Hold 17 0.97 0.42
Dalmia Bharat 11.46 8.50 39.34 Hold 28 0.94 0.50
UltraTech 20.02 16.24 34.35 Buy 37 0.90 0.62
ACC 9.56 8.29 25.09 Buy 18 0.78 0.38
* The mean of analysts’ 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
OCT-DEC STOCK PERFORMANCE
— All data from LSEG
— $1 = 86.6120 Indian rupees
(Reporting by Kashish Tandon in Bengaluru; Editing by Savio D’Souza)
