Low Pro­duc­tion Cost Keeps Shree Cem Ahead of Peers

Com­pany’s pres­ence in key growth mar­kets and its de­ci­sion to be se­lec­tive about mar­ket ex­pan­sion have aided its growth jour­ney

The Economic Times - - Smart -

Se­cu­ri­ties, a bro­ker­age, men­tioned in a re­port that the ex­pected growth in the com­pany’s ex­pected cash earn­ings per share (EPS) at above 25% be­tween FY17 and FY19 is higher than peers’ av­er­age.

Con­sid­er­ing FY19 es­ti­mated oper­at­ing profit be­fore de pre­ci­a­tion (EBITDA) and the Thurs­day’s stock price of Rs 17,384.9, Shree’s en­ter­prise value (EV) is 14.5 times EBITDA. This may ap­pear ex­pen­sive when com­pared with its peers who are trad­ing within EV/EBITDA range of 11-14. But the pre­mium is jus­ti­fied given the com­pany’s cost ad­van­tage and dom­i­nant pres­ence in the key mar­kets.

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