Kajaria Ceramics performance was strong across topline & bottomline. The sales volumes were up 10.5% YoY at 22.6 MSM, as utilisation got back to full levels coupled with strong outsourced sales driven by robust rebound in demand. The topline was up 13.1% YoY at Rs. 838.4 crore with stable realisations (up 0.3% YoY). Tiles Revenues were up 10.9% YoY at Rs. 758.2 crore. Faucet and Sanitaryware revenues were up 36% YoY at Rs. 67.4 crore. Plywood revenues were up 57.6% YoY at Rs. 12.8 crore, on a low base. EBITDA at Rs. 181.8 crore with margins at 21.7% were up 667 bps YoY driven by lower other expenses and operating leverage. The beat at operating level percolated to PAT wherein it reported a Rs. 118.9 crore, up 93% YoY.
Valuation & Outlook
Continued export demands for Morbi players is likely to keep both the demand and pricing scenario robust for the organised players. The increased dividend payout (~40-50% vs. 20-25%, earlier) is likely to improve return ratios. Kajaria, with a net cash balance sheet and superior brand, is a quasi-play on improved scenario. We raise our earnings estimates by 26%/ 27%, for FY21E/ FY22E respectively, given the commentary. We maintain BUY and roll over our valuations to FY23E at 29x P/E (vs. 30x FY22E P/E, earlier) to ascribe revised target price of Rs. 950/share.
For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_KajariaCeramics_Q3FY21.pdf
Shares of KAJARIA CERAMICS LTD. was last trading in BSE at Rs.795.2 as compared to the previous close of Rs. 783.85. The total number of shares traded during the day was 98385 in over 4242 trades.
The stock hit an intraday high of Rs. 839.4 and intraday low of 775.15. The net turnover during the day was Rs. 80001138.