HEIDELBERG CEMENT INDIA
We had recommended Heidelberg Cement India in volume no 34, issue no 47 (dated Sept 10, 2018) when the scrip was trading at Rs 163. Our recommendation was backed by factors like robust growth and uptick in demand. In Q2FY19, the company’s revenue was up by 14.1 percent YoY from Rs 426 crore to Rs 486 crore. EBITDA grew by 25.8 percent YoY and margin improved from 22 percent to 24 percent. PAT for the quarter jumped by 51.5 percent YoY to Rs 50 crore from Rs 33 crore. The demand in eastern and central regions of India, where the company has a major pres- ence, is expected to remain stable. By FY21, the whole cement industry would expand its capacity by 60-65 MT. Considering these factors, we urge investors to HOLD the scrip.