Star Cement Q2 Results Review

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Star Cement Ltd. reported volume, revenue above estimates, however realization, Ebitda, adjusted profit after tax in line whereas Ebitda/tonne below estimates.

Star Cement posted 46.2% YoY growth in revenue (down 10.8% QoQ) to Rs 5.9 billion led by led by up 44.2% YoY in volume to 0.89 million tonne (down 9.1% QoQ) coupled with up 1.4% YoY in realisation/tonne to Rs 6,669 (down 1.9% QoQ).

Ebitda/ adjusted profit after tax reported down 2.8% /down 34.0% YoY to Rs 697 million/ Rs 311 million.

We expect 17.6%/ 22.8% revenue/ Ebitda compound annual growth rate over FY22-25E led by 17.5%/ 10.0%/ 22.0% volume growth and 3.2% / 0.0%/ 0.0% realisation growth in FY23E/FY24E/ FY25E.

However, we expect -0.9% adjusted profit after tax CAGR over FY22-25E.

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