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Buy Shree Cements, target price Rs 32750: Emkay Research

Research has a buy call on with a target price of Rs 32750 for a time frame of 12 months. The current market price of Shree Cements is Rs 26852.25.

Shree Cements Ltd, incorporated in the year 1979, is a Large Cap company with a market cap of Rs 97927.30 Crore, operating in Cement sector.

Shree Cements Ltd’s key Products/Revenue Segments include Cement, Power, Clinker, Other Operating Revenue and Scrap for the year ending 31-Mar-2020.

Investment Rationale

Emkay Research maintains its FY22-23 estimates. It has a buy rating with a DCF-derived target price of Rs 32,750 (Jun’22E), implying 19x 1-year forward EV/E. The stock’s premium valuation at current 19.2x EV/E already reflects Emkay’s strong outlook on the company, hence it expects the stock’s returns to be driven essentially by earnings compounding. Key downside risk is overseas mergers and acquisition, it added.

Financials

For the quarter ended 31-03-2021, the company has reported a Consolidated Total Income of Rs 4333.37 Crore, up 18.74 per cent from last quarter’s Total Income of Rs 3649.38 Crore and up 23.34 per cent from last year same quarter’s Total Income of Rs 3513.31 Crore. Company has reported a net profit after tax of Rs 799.79 Crore in latest quarter.

(Views and recommendations given in this section are the analysts’ own and do not represent those of ETMarkets.com. Please consult your financial adviser before taking any position in the stock/s mentioned.)

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