JK Lakshmi Cement share price rises 7% post Q4 results, dividend announcement: Strong operating performance drives beat

Stock Market Today: JK Lakshmi Cement share price gained more than 7% in the morning trades on Friday post Q4 Results that were declared after the market hours on Thursday.

The JK Lakshmi Cement share price that opened at ₹830 , rose to highs of ₹852.85 on the NSE, on Friday , marking gains of more than 7% over the closing price on Thursday

JK Lakshmi Cement consolidated Net profit  came in at ₹159.85 Crore rising 41% year-on-year and was ahead of analysts estimates. Analysts at Motilal Oswal Financial Services estimated Net profit at around ₹140 Crore. Analysts at Axis Securities expected net profit to come at ₹132 Crore.

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Strong beat led by improved operating performance

The beat in net profit that helped drive JK Lakshmi Cement share price, was driven by strong operating performance.  The per tonne profitability or Ebitda per tonne  rose 43% YoY to ₹1,032 much above ₹852 estimated by MOFSL. Axis Securities Ebitda per tonne estimates stood at ₹893 Ebitda stands for Earnings before interest tax depreciation and amortisation. 

This beat was led by strong improvement in operating performance as sales volume at 3.26 million tonne just rose 1% year-on-year. Lower than-estimated operating costs helped, said analysts.

Consolidated Ebitda increased 45% YoY to around ₹340 crore, rising 48% year-on-year.

Consolidated revenue from operations at ₹1780.85 crore came slightly lower than ₹1862 crore in the year ago quarter.

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Dividend announcement

JK Lakshmi recommended a final dividend of ₹4.50per Equity Share of face value of ₹5 each (90% payout) for the Financial Year ended 31st March 2024. This dividend announcement is  in addition to Interim Dividend of ₹2 per Equity Share paid by the company taking total dividend payout to ₹6. 50,- per Equity share.

Analysts views

 The Cement demand outlook in the country for FY25 remains strong. Analysts however are watchful on price uptick in the near term. The Cement prices hikes at start of April have mostly not been able to sustain. The onset on monsoon in June also may keep cement prices range bound with rise expected mostly after monsoon season. The easing of input prices  nevertheless is positive and the same coupled with rising volumes can still support earnings in the interim.

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 JK Lakshmi Cement is also expanding clinker and cement capacity by 2.3mtpa and 6.0mtpa (million tonne per annum) in the next two to three years, which should help support volume growth and market share. The company targets to increase grinding capacity to 30mtpa by FY30 from 16.5mtpa currently.

Analysts at MOFSL have a BUY rating on the stock. However, they will review their estimates after the concal on 27th May’2024

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions