RESULT UPDATE

ULTRATECH CEMENT
Impressive organic volume growth
India Equity Research| Cement
COMPANYNAME
UltraTech Cement’s (UTCL) Q3FY18 EBITDA at INR12.7bn disappointed as EDELWEISS 4D RATINGS
it came 7% below estimate. However, the company reported an
Absolute Rating BUY
impressive volume growth of 35% (25% estimate), which adjusted for
Rating Relative to Sector Outperform
recently acquired JP Associate’s (JPA) cement assets, stands at a Risk Rating Relative to Sector Medium
commendable 17% (10-11% industry growth). While the market share Sector Relative to Market Overweight
gain may have come at the cost of realisations (down 3.7% QoQ versus
2.0% estimate), cement prices are set to recover in the current busy
season and stay buoyant until June 2018. Rising energy cost (pet coke, MARKET DATA (R: ULTC.BO, B: UTCEM IN)
coal and diesel) led to variable cost/t rising 2.5% QoQ (likely to rise CMP : INR 4,409
further given increase in import duty on pet coke). But, given that this is Target Price : INR 5,172
52-week range (INR) : 4,600 / 3,377
an industry-wide phenomenon, we expect it to be passed on to
Share in issue (mn) : 274.6
consumers during the busy season. Calibrating 9mFY18 performance,
M cap (INR bn/USD mn) : 1,210 / 18,955
recent trends in fuel cost and cement prices, we prune FY18/FY19E Avg. Daily Vol.BSE/NSE(‘000) : 244.7
EBITDA 9%/16%. However, we stay positive on UTCL as: i) the market
leader will be prime beneficiary of rising clinker utilisations in FY20; and SHARE HOLDING PATTERN (%)
ii) operating leverage will improve as JPA volumes ramp up. In this
Current Q2FY18 Q1FY18
backdrop, we introduce FY20E EBITDA at 24% YoY growth and maintain Promoters * 62.0 62.1 62.1
‘BUY’ with revised TP of INR5,172 (INR4,862 earlier).
MF's, FI's & BK’s 5.7 5.6 5.6
FII's 22.2 22.1 21.9
Q3FY18 result: Key highlights Others 10.1 10.1 10.4
• Domestic grey cement volumes grew 37% YoY. Recently acquired 17.2mtpa JP * Promoters pledged shares : NIL
(% of share in issue)
capacity operated at 51% utilisation, implying a robust 17% organic growth. While
low base (2% drop in Q3FY17 owing to demonetisation) helped, the growth
PRICE PERFORMANCE (%)
implies market share gain versus an estimated 10-11% industry growth. While grey
realisations fell 3.7% QoQ, they are set to rebound in the current busy season. EW
Stock Nifty Construction
• Variable cost/t was largely in line, rising 2.5% QoQ owing to fuel price hike and is Material Index

set to increase further with rising cost of coal prices and levy of import duty on pet 1 month 5.4 4.4 8.0
coke. With ramp up of acquired JPA’s assets, fixed costs jumped 14% QoQ versus 3 months 11.1 5.4 2.3
our 5% estimate. Blended EBITDA/t at INR801 dipped 16% YoY. 12 months 34.4 28.5 38.3

Outlook & valuations: Impressive market share gain; retain ‘BUY’

We maintain our positive view on the sector given imminent rise in industry clinker
utilisations in FY20 (to >80%) and expected demand buoyancy in FY19 in the run up to
the general election. We continue to value UTCL at 15x EV/EBITDA and rolling over
valuations to FY20E, maintain ‘BUY/SO’ with TP of INR5,172 (INR4,862 earlier).
Financials (INR mn)
Year to March Q3FY18 Q3FY17 % Chg Q2FY18 % Chg FY17 FY18E FY19E
Total operating Income 75,899 56,093 35.3 65,713 15.5 238,914 296,417 361,490 Navin R. Sahadeo
EBITDA 12,691 11,136 14.0 13,513 (6.1) 49,690 59,736 80,791 +91 22 4088 6242
navinr.sahadeo@edelweissfin.com
Adjusted Profit 4,215 5,634 (25.2) 4,312 (2.3) 25,036 24,690 37,018
Diluted EPS (INR) 15.4 20.5 (25.2) 15.7 (2.3) 91.2 89.9 134.9 Sharif Hadimani
Diluted P/E (x) 47.6 49.0 32.7 +91 22 6620 3111
sharif.hadimani@edelweissfin.com
EV/EBITDA (x) 24.1 22.5 16.3
ROAE (%) 11.2 9.9 13.3 January 18, 2018
Edelweiss Research is also available on www.edelresearch.com,
Bloomberg EDEL <GO>, Thomson First Call, Reuters and Factset. Edelweiss Securities Limited
Cement
Other key highlights
Other income for the quarter had an exceptional item of INR1bn~related to reversal of
excess provisions towards District Mineral Find for previous years. Adjusted to the same,
other income at INR0.5bn dipped 69% QoQ due to MTM adjustments on investments.

Table 1: Flat realizations amid rising costs dragged EBITDA/t YoY

(INR/tonne) Q3FY18 Q3FY17 % change Q2FY18 % change
Realisation 4,789 4,782 0.1 5,001 (4.2)
Raw material 840 787 6.7 697 20.6
Power 952 826 15.3 1,016 (6.3)
Freight 1,176 1,160 1.4 1,184 (0.7)
Staff 292 311 (6.1) 338 (13.6)
Others 728 748 (2.7) 739 (1.4)
Cost 3,988 3,833 4.1 3,973 0.4
EBITDA 801 949 (15.7) 1,028 (22.1)
Source: Company, Edelweiss research

Chart 1: Sales volume surged 35% YoY

18 40.0

14 30.0

11 20.0
(mn t)

(%)
7 10.0

4 0.0

0 (10.0)
Q3FY17 Q4FY17 Q1FY18 Q2FY18 Q3FY18
Total sales volume Growth YoY (RHS)

Chart 2: Blended EBITDA/t dipped 16% YoY

1,500 14.0

1,200 7.0

900 0.0
(INR/t)

(%)

600 (7.0)

300 (14.0)

0 (21.0)
Q3FY17 Q4FY17 Q1FY18 Q2FY18 Q3FY18
EBITDA/t Growth YoY (RHS)
Source: Company, Edelweiss research

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Table 2: Target price revised to INR5,172 (earlier INR4,862)

Particulars (INR mn) FY20E
Assumed EV/EBITDA multiple (x) (A) 15.0
EBITDA of UltraTech (incl. JPA) (B) 100,074
Assumed EBITDA of ETA Star (C ) 2,250
Total EBITDA (D ) = (B) + ( C) 102,324
Enterprise Value (E) = (A) x (D) 1,534,853
Less: Consolidated Net debt (F) 114,966
Mcap (G) = (E) - (F) 1,419,887
Shares o/s (mn) (H) 274.5
Value per share (INR) (G) / (H) 5,172
Potential upside (%) 17.3
Source: Edelweiss research

Q3FY18 conference call: Key highlights

Industry:

 Demand outlook remains impressive given the government’s continued infrastructure

spending, ramp up in construction of affordable housing and focus on reviving the rural
economy.

 However sand issues continue to challenge demand in states of Uttar Pradesh,

Rajasthan, Bihar and Tamil Nadu. It expects an early resolution with proactive
involvement of the respective state machinery.

 As per the company, inter –state movement of cement may face challenges post
introduction of E-Way bill from 1st Feb, 2018 and UTCL is already working proactively to
counter the same.

 By the end of FY19, UTCL expects total capacity addition of ~30-35mtpa at industry
level.

All-India cement prices were muted during the quarter dropping ~4-5% QoQ led by 10%
QoQ dip in South followed by West, down 3-4% QoQ. However, average prices were up 2%
QoQ in North (including Central) and ~5% in East.

Cost headwinds: On the cost front, industry has been witnessing north-bound journey in
input costs since the last almost 8 quarters. Consistent rise in market prices of petcoke, coal,
diesel and other raw materials has been affecting industry profitability. However, at UTCL,
the company has been countering these cost escalations with sustained efficiency measures.

Cement industry has been allowed to use pet coke as ruled by government and the Supreme
Court (ruling out earlier order of complete usage ban in Haryana, Rajasthan and UP).
However, usage in captive power plants (CPP) remains banned.

Operational highlights:
 Overall domestic sales volumes surged ~37% YoY to 15.1mt driven by both uptick in
demand as well as consolidation of acquired JPA assets. Total volumes, including white
cement and exports, stood at 15.85mt, up 35% YoY.
 Excluding JPA, the growth would have been ~17% largely driven by strong demand in
North and East.

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Cement
 Regionally, the capacity utilisation for the company was: North - >80%, Central - >60%+,
East ~80%, West - ~70% and South at ~53%.

 The company took annual maintenance shut-down of JPA plants (all the 5 integrated
units) during November 2017. Accordingly, the relevant cost of ~INR100/t was included
in “Other expenses” during Q3FY18.

 Other income during the quarter included an one-off income of INR1bn related to
District Mineral Fund (DMF) reversal. However, adjusting for the same, the regular
treasury income was ~INR430mn (versus INR1.2-1.3bn in Q2FY18), much below
compared to previous quarter due to mark to market adjustment of investments.

 Capacity utilisation of JPA assets stands at ~60% currently versus 51% for Q3FY18 and
they are well ahead of their guidance to meet 65-70% utilisation by Q1FY19.

 RMC segment has been witnessing strong volume gains reflecting growth momentum
in country’s infrastructure projects.

 The company is planning for two additional WHRS units (combined ~26MW) in the next
two years.

 Total capex for FY20 is estimated to be ~INR25bn.

 By the end of FY19, UTCL expects total capacity addition of ~30-35mtpa at industry
level.

Q2FY18 conference call: Key highlights

Operational updates

• Total sales volume stood at 13.1mt, up 17.5% YoY, mainly led by consolidation of JPA
assets. However, management mentioned overall industry growth trend was flat to low
single-digit YoY during Q2FY18.

• Cement demand was impacted by severe sand shortage in major states such as Uttar
Pradesh (UP), Bihar, Maharashtra and Tamil Nadu (TN), while government projects and
pick up in rural demand helped volume growth in Jharkhand, Odisha, Chhattisgarh,
Madhya Pradesh (MP), Andhra Pradesh (AP) and Telangana, among others.
• Sand mining at select mines commenced in Bihar from Oct 3, 2017 and is expected to
ease availability going ahead. Hopeful of faster resolution in UP and TN as well.

• Management believes the government-led low-cost housing programmes will gain

significant traction going ahead and will be one of the major drivers of demand.
• Various infrastructure projects like roads, irrigation, metro and bullet train among
others, will also see increase in cement demand.

• Region-wise capacity utilisation trend for the company stood in the range of 68-70% in
North, 70% in East, 50% in Central & South region, and ~60% in West markets.

• GST transition has been successful and almost 95% of the company’s network is
compliant with GST requirements.

• Continued rise in pet coke and diesel prices impacted overall operating expenses,
though partially offset by improved efficiency measures undertaken by the company.

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• Average pet coke cost/t during the quarter was USD90/t which compares to current
market price of ~USD105/t. At its plants in Karnataka, Maharashtra and Chhattisgarh,
the company is contemplating to shift from pet coke to coal.

• Board of Directors approved investment of INR1.9bn for putting up 0.4mtpa wall putty
plant, which is expected to be operational by Q2FY20.
Update on acquisition of JPA’s assets

• UTCL is on track to achieve 60% utilisation for the acquired JPA assets towards end of
fourth quarter of operations (Apr-Jun’18 quarter).
• In Q2FY18, UTCL infused working capital to start operations. It has appointed a dealer
network and completed UTCL brand transitioning across all addressable markets.
Overall, these acquired assets contributed largely in latter part of Q2FY18. Hence,
management expects continued volume ramp up at these plants.

• UTCL reiterated its earlier targets of achieving cash breakeven at JPA plants by end of
fourth quarter of operations (Q1FY19) with first quarter being Q2FY18, and PAT level
break even after 8 quarters.

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Financial snapshot (INR mn)

Year to March Q3FY18 Q3FY17 % change Q2FY18 % change YTD18 FY18E FY19E
Total operating Income 75,899 56,093 35.3 65,713 15.5 207,876 296,417 361,490
Raw material costs 13,310 9,236 44.1 9,153 45.4 32,010 46,290 56,717
Power and fuel 15,093 9,689 55.8 13,348 13.1 40,615 58,985 72,822
Freight outward 18,634 13,606 37.0 15,553 19.8 50,066 71,367 83,425
Staff costs 4,628 3,647 26.9 4,440 4.3 12,871 17,499 19,355
Other expenses 11,541 8,779 31.5 9,707 18.9 30,510 42,541 48,379
Total expenditure 63,207 44,956 40.6 52,200 21.1 166,071 236,682 280,698
EBITDA 12,691 11,136 14.0 13,513 (6.1) 41,804 59,736 80,791
Depreciation 4,744 3,156 50.3 4,988 (4.9) 12,830 17,774 19,621
EBIT 7,947 7,980 (0.4) 8,525 (6.8) 28,975 41,962 61,171
Other income 1,556 969 60.6 1,680 (7.4) 4,888 5,174 4,055
Interest 3,472 1,293 168.5 3,759 (7.6) 8,515 11,865 12,343
Profit before tax 6,031 7,655 (21.2) 6,447 (6.5) 25,347 35,271 52,883
Tax 1,816 2,021 (10.1) 2,135 (14.9) 7,914 10,581 15,865
Reported net profit 4,215 5,634 (25.2) 4,312 (2.3) 17,433 24,690 37,018
Adjusted Profit 4,215 5,634 (25.2) 4,312 (2.3) 17,433 24,690 37,018
Equity capital(FV INR10) 2,746 2,745 2,745 2,746 2,745 2,745
Diluted shares (mn) 275 274 274 275 275 275
Diluted EPS (INR) 15.4 20.5 (25.2) 15.7 (2.3) 63.5 89.9 134.9
Diluted P/E (x) 49.0 32.7
EV/EBITDA (x) 22.5 16.3
ROAE (%) 9.9 13.3

As % of net revenues
Raw material 17.5 16.5 13.9 15.4 15.6 15.7
Employee cost 6.1 6.5 6.8 6.2 5.9 5.4
Power & fuel 19.9 17.3 20.3 19.5 19.9 20.1
Freight outward 24.6 24.3 23.7 24.1 24.1 23.1
Other expenses 15.2 15.7 14.8 14.7 14.4 13.4
EBITDA 16.7 19.9 20.6 20.1 20.2 22.3
Reported net profit 5.6 10.0 6.6 8.4 8.3 10.2

Change in Estimates
FY18E FY19E
New Old % change New Old % change Comments
Net Revenue 296,417 294,450 0.7 361,490 380,618 (5.0) Calibrating for 9mFY18
EBITDA 59,736 65,786 (9.2) 80,791 96,060 (15.9) performance, recent trends in fuel
EBITDA Margin 20.2 22.3 22.3 25.2 cost and cement prices, we have
Adjusted PAT 24,690 28,343 (12.9) 37,018 47,383 (21.9) revised our estimates.
Net Profit Margin 8.3 9.6 10.2 12.4
Capex 20,400 22,900 (10.9) 22,980 26,050 (11.8)

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 UltraTech Cement

Company Description
UTCL, post the merger with Samruddhi Cement (demerged cement arm of Grasim
Industries), has a combined cement capacity of 69mtpa (including ETA Star and the recently
acquired 4.8mtpa of cement assets in Gujarat from JPA), 754 MW thermal captive power
plants (that meets ~80% of requirement) with pan-India presence aggregating to market
share of ~19%. Grasim, the flagship company of the AV Birla Group, is a majority
shareholder in UTCL with 60.3% ownership. The company has also proposed to acquire JPA’s
21.2mtpa capacity spread across India, which is awaiting regulatory clearances. Post the
expansion and the proposed acquisition, UltraTech's cement capacity would increase to
~91mtpa.

Investment Theme
Our investment thesis is following (a) Large ticket M/As as well meager capacity addition
programs (largely by industry leaders) gives us a greater comfort of secular profit increase in
the sector sooner than later. Our current estimates of EPS CAGR for Ultratech at ~25% over
FY17-20E may well continue till FY21/FY22E given rising utilization/consolidation (b) Post
culmination of the JPA deal, the operating leverage for Ultratech would probably be
amongst the highest in Indian cement space- 1% volume variation is positive ~2% to EPS and
1% in price 8-9% to EPS (c) Fair value at 15x FY19E EBITDA appears reasonable given position
in the cycle.

Key Risks
Sharp decrease in cement demand/prices may lead to further earnings downgrade.

Sharp increase in fuel cost/input cost will impact estimates

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Financial Statements
Key Assumptions Income statement (INR mn)
Year to March FY17 FY18E FY19E FY20E Year to March FY17 FY18E FY19E FY20E
Macro Total volume (mn tonnes) 50.2 60.1 70.6 77.1
GDP(Y-o-Y %) 6.6 6.5 7.1 7.6 Income from operations 238,914 296,417 361,490 412,503
Inflation (Avg) 4.5 3.8 4.5 5.0 Materials costs 40,245 46,290 56,717 63,782
Repo rate (exit rate) 6.3 6.0 6.0 6.5 Power and fuel 39,266 58,985 72,822 81,098
USD/INR (Avg) 67.1 64.5 65.0 66.0 Freight 58,452 71,367 83,425 93,817
Company Employee costs 14,134 17,499 19,355 21,484
EBITDA/ Tonne (INR) 990 993 1,145 1,299 Factory & admin expenses 37,128 42,541 48,379 52,249
Inst capacity (mtpa) 66 85 89 93 Total operating expenses 189,225 236,682 280,698 312,430
Capacity Utilisation (%) 73 69 78 82 EBITDA 49,690 59,736 80,791 100,074
Cement sales vol (mt) 50 60 71 77 Depreciation 12,679 17,774 19,621 21,044
Cement realiztn (INR/t) 4,760 4,930 5,122 5,353 EBIT 37,011 41,962 61,171 79,030
RM cost per tonne 802 770 804 828 Add: Other income 5,221.8 5,174.41 4,054.93 5,639.73
P&F cost per tonne 782 981 1,032 1,052 Less: Interest Expense 5,714 11,865 12,343 11,543
Freight cost per tonne 1,165 1,187 1,182 1,217 Add: Exceptional items 1,241 - - -
Other expenses per tonne 740 707 685 678 Profit Before Tax 37,760 35,271 52,883 73,127
Total expenses per tonne 3,770 3,936 3,977 4,054 Less: Provision for Tax 11,482 10,581 15,865 21,938
Effective tax rate (%) 30.4 30.0 30.0 30.0 Reported Profit 26,277 24,690 37,018 51,189
Debtor days 21 17 16 15 Adjusted Profit 25,414 24,690 37,018 51,189
Inventory days 60 56 57 54 Shares o /s (mn) 274 275 275 275
Payable days 44 41 40 38 Adjusted Basic EPS 92.6 89.9 134.9 186.5
Diluted shares o/s (mn) 274 275 275 275
Adjusted Diluted EPS 92.6 89.9 134.9 186.5
Adjusted Cash EPS 138.8 154.7 206.3 263.1
Dividend per share (DPS) 10.0 10.0 11.0 12.0
Dividend Payout Ratio(%) 12.5 13.3 9.8 7.7

Common size metrics

Year to March FY17 FY18E FY19E FY20E
Operating expenses 79.2 79.8 77.7 75.7
Materials costs 16.8 15.6 15.7 15.5
Power and fuel 16.4 19.9 20.1 19.7
Freight 24.5 24.1 23.1 22.7
Depreciation 5.3 6.0 5.4 5.1
Interest Expense 2.4 4.0 3.4 2.8
EBITDA margins 20.8 20.2 22.3 24.3
Net Profit margins 10.6 8.3 10.2 12.4

Growth ratios (%)

Year to March FY17 FY18E FY19E FY20E
Revenues 0.8 24.1 22.0 14.1
EBITDA 7.4 20.2 35.2 23.9
PBT 14.5 (6.6) 49.9 38.3
Adjusted Profit 7.2 (2.8) 49.9 38.3
EPS 7.2 (2.9) 49.9 38.3

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 UltraTech Cement
Balance sheet (INR mn) Cash flow metrics
As on 31st March FY17 FY18E FY19E FY20E Year to March FY17 FY18E FY19E FY20E
Share capital 2,745 2,745 2,745 2,745 Operating cash flow 47,213 35,376 54,345 70,480
Reserves & Surplus 236,665 258,061 291,455 338,691 Investing cash flow (23,635) (165,030) (22,980) (65,850)
Shareholders' funds 239,410 260,806 294,200 341,436 Financing cash flow (23,826) 109,206 (28,624) (3,953)
Short term borrowings 20,403 35,403 35,403 35,403 Net cash Flow (249) (20,448) 2,742 677
Long term borrowings 42,374 139,874 114,874 114,874 Capex (12,274) (20,400) (22,980) (25,850)
Total Borrowings 62,777 175,277 150,277 150,277 Dividend paid (3,085) (3,294) (3,624) (3,953)
Def. Tax Liability (net) 27,736 27,736 27,736 27,736
Sources of funds 329,923 463,818 472,213 519,449 Profitability and efficiency ratios
Gross Block 358,463 498,093 508,093 - Year to March FY17 FY18E FY19E FY20E
Net Block 228,982 350,839 341,218 356,174 ROAE (%) 11.2 9.9 13.3 16.1
Capital work in progress 8,784 19,184 32,164 22,014 ROACE (%) 14.1 12.8 14.8 18.1
Intangible Assets 3,335 35,335 35,335 35,335 Inventory Days 60 56 57 54
Total Fixed Assets 241,102 405,358 408,717 413,524 Debtors Days 21 17 16 15
Non current investments 21,324 16,324 16,324 16,324 Payable Days 44 41 40 38
Cash and Equivalents 76,237 43,789 46,530 87,208 Cash Conversion Cycle 37 33 33 32
Inventories 22,250 32,093 34,180 36,862 Current Ratio 2.1 1.6 1.7 2.3
Sundry Debtors 12,762 15,252 16,880 18,068 Gross Debt/EBITDA 1.3 2.9 1.9 1.5
Loans & Advances 9,729 9,729 9,729 9,729 Gross Debt/Equity 0.3 0.7 0.5 0.4
Other Current Assets 9,409 9,409 9,409 9,409 Adjusted Debt/Equity 0.3 0.7 0.5 0.4
Current Assets (ex cash) 54,149 66,482 70,198 74,067 Interest Coverage Ratio 6.5 3.5 5.0 6.8
Trade payable 17,138 22,384 23,806 25,923
Other Current Liab 45,750 45,750 45,750 45,750 Operating ratios
Total Current Liab 62,888 68,134 69,556 71,674 Year to March FY17 FY18E FY19E FY20E
Net Curr Assets-ex cash (8,739) (1,652) 641 2,394 Total Asset Turnover 0.7 0.7 0.8 0.8
Uses of funds 329,923 463,818 472,213 519,449 Fixed Asset Turnover 1.0 1.0 0.9 1.1
BVPS (INR) 872.3 950.1 1,071.7 1,243.8 Equity Turnover 1.0 1.2 1.3 1.3

Free cash flow (INR mn) Valuation parameters

Year to March FY17 FY18E FY19E FY20E Year to March FY17 FY18E FY19E FY20E
Reported Profit 26,277 24,690 37,018 51,189 Adj. Diluted EPS (INR) 92.6 89.9 134.9 186.5
Add: Depreciation 12,679 17,774 19,621 21,044 Y-o-Y growth (%) 7.2 (2.9) 49.9 38.3
Interest (Net of Tax) 3,976 8,306 8,640 8,080 Adjusted Cash EPS (INR) 138.8 154.7 206.3 263.1
Others (598) (8,306) (8,640) (8,080) Diluted P/E (x) 47.6 49.0 32.7 23.6
Less: Changes in WC (4,878) 7,087 2,293 1,752 P/B (x) 5.1 4.6 4.1 3.5
Operating cash flow 47,213 35,376 54,345 70,480 EV/tonne (USD/tonne) 263 244 226 208
Less: Capex 12,274 20,400 22,980 25,850 EV / Sales (x) 5.0 4.5 3.6 3.1
Free Cash Flow 34,939 14,976 31,365 44,630 EV / EBITDA (x) 24.1 22.5 16.3 12.7
EV/EBITDA (x)+1 yr fwd. 20.0 16.6 13.1 -
Dividend Yield (%) 0.2 0.2 0.2 0.3

Peer comparison valuation

Market cap Diluted P/E (X) EV / EBITDA (X) EV / Sales (X)
Name (USD mn) FY18E FY19E FY18E FY19E FY18E FY19E
UltraTech Cement 18,954 49.0 32.7 22.5 16.3 4.5 3.6
ACC 5,408 40.0 31.1 17.4 14.3 2.4 2.1
Ambuja Cement Ltd 8,571 46.1 35.8 27.4 21.8 3.8 3.4
Shree Cements 10,049 47.8 36.3 25.5 18.9 6.9 5.5
Median - 46.9 34.3 24.0 17.6 4.2 3.5
AVERAGE - 45.7 34.0 23.2 17.8 4.4 3.7
Source: Edelweiss research

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Additional Data
Directors Data
Kumar Mangalam Birla Chairman Mrs. Rajashree Birla Director
R. C. Bhargava Independent Director G. M. Dave Independent Director
Mrs Sukanya Kripalu Independent Director S. B. Mathur Independent Director
Rajiv Dube Independent Director Mrs. Renuka Kamath Independent Director
D. D. Rathi Non- Executive Director K. K. Maheshwari Managing Director
Arun Adhikari Independent Director Mrs. Alka Bharucha Independent Director
Atul Daga Whole-time Director and Chief Financial Officer

Auditors - Deloitte Haskins & Sells, G. P. Kapadia & Co.

*as per last annual report

Holding – Top 10
Perc. Holding Perc. Holding
Life Insurance Corp of India 2.20 Standard Life Aberdeen Plc 2.01
JPMorgan Chase & Co 1.81 Massachusetts Mutual Life Ins 1.49
Blackrock 1.20 Vanguard Group 1.06
Capital Group Companies Inc 1.03 Franklin Resources 0.98
SBI Funds Management 0.49 Kotak Mahindra 0.41
*as per last available data

Bulk Deals
Data Acquired / Seller B/S Qty Traded Price

No Data Available
*in last one year

Insider Trades
Reporting Data Acquired / Seller B/S Qty Traded
15 May 2017 Trapti Trading and Investments Private Limited Sell 25135.00
07 Apr 2017 Turquoise Investments and Finance Private Limited Sell 66678.00
07 Apr 2017 Turquoise Investments and Finance Private Limited Sell 36816.00
06 Apr 2017 Turquoise Investments and Finance Private Limited Sell 66678.00
06 Apr 2017 Turquoise Investments and Finance Private Limited Sell 36816.00
*in last one year

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 RATING & INTERPRETATION

Company Absolute Relative Relative Company Absolute Relative Relative

reco reco risk reco reco Risk
ACC BUY SP M Ambuja Cement Ltd HOLD SU M
Grasim Industries BUY SO M India Cements BUY SP H
JK Cement BUY SO M Shree Cements BUY SO M
UltraTech Cement BUY SO M

ABSOLUTE RATING
Ratings Expected absolute returns over 12 months

Buy More than 15%

Hold Between 15% and - 5%

Reduce Less than -5%

RELATIVE RETURNS RATING

Ratings Criteria
Sector Outperformer (SO) Stock return > 1.25 x Sector return

Sector Performer (SP) Stock return > 0.75 x Sector return

Stock return < 1.25 x Sector return

Sector Underperformer (SU) Stock return < 0.75 x Sector return

Sector return is market cap weighted average return for the coverage universe
within the sector

RELATIVE RISK RATING

Ratings Criteria

Low (L) Bottom 1/3rd percentile in the sector

Medium (M) Middle 1/3rd percentile in the sector

High (H) Top 1/3rd percentile in the sector

Risk ratings are based on Edelweiss risk model

SECTOR RATING
Ratings Criteria
Overweight (OW) Sector return > 1.25 x Nifty return

Equalweight (EW) Sector return > 0.75 x Nifty return

Sector return < 1.25 x Nifty return

Underweight (UW) Sector return < 0.75 x Nifty return

11 Edelweiss Securities Limited

 Cement

Edelweiss Securities Limited, Edelweiss House, off C.S.T. Road, Kalina, Mumbai – 400 098.
Board: (91-22) 4009 4400, Email: research@edelweissfin.com

ADITYA
Digitally signed by ADITYA NARAIN
DN: c=IN, o=EDELWEISS SECURITIES LIMITED,
Aditya Narain ou=HEAD RESEARCH, cn=ADITYA NARAIN,
serialNumber=e0576796072ad1a3266c2799
0f20bf0213f69235fc3f1bcd0fa1c30092792c2
Head of Research
NARAIN
0, postalCode=400005,
2.5.4.20=3dc92af943d52d778c99d69c48a8e
0c89e548e5001b4f8141cf423fd58c07b02,
aditya.narain@edelweissfin.com st=Maharashtra
Date: 2018.01.18 23:46:44 +05'30'

Coverage group(s) of stocks by primary analyst(s): Cement

ACC, Ambuja Cement Ltd, Grasim Industries, India Cements, JK Cement, Shree Cements, UltraTech Cement

Recent Research

Date Company Title Price (INR) Recos

12-Jan-18 Shree Decent quarter; Insipid UAE 19536 Buy

Cements acquisition; Result Update
10-Jan-18 Cement Busy season vibrancy in the
(Concrete face of coal price hike;
Calling) Sector Update
22-Dec-17 Cement Cement prices catch winter
(Concrete chill; Sector Update
Calling)

Distribution of Ratings / Market Cap

Edelweiss Research Coverage Universe Rating Interpretation

Buy Hold Reduce Total Rating Expected to

Rating Distribution* 161 67 11 240 Buy appreciate more than 15% over a 12-month period
* 1stocks under review
Hold appreciate up to 15% over a 12-month period
> 50bn Between 10bn and 50 bn < 10bn
743
Reduce depreciate more than 5% over a 12-month period
Market Cap (INR) 156 62 11
594

One year price chart

446
5,000
(INR)

297 4,600

149 4,200
(INR)

- 3,800
Apr-14

Sep-14
Feb-14

Mar-14

Jun-14

Dec-14
Jul-14

Aug-14

Oct-14

Nov-14
May-14
Jan-14

3,400

3,000
Dec-17
Aug-17

Oct-17
Apr-17

May-17

Nov-17
Jan-17

Jan-18
Feb-17

Sep-17
Jun-17
Mar-17

Jul-17

UltraTech Cement

12 Edelweiss Securities Limited

 UltraTech Cement
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