Fairval

Notes on Indian equities, sectors and economy

Archive for the ‘Cement’ Category

Cement valuations

Posted by fairval on July 5, 2010

Cement Valuation Range for top end companies

The EV/Capacity chart is a bit of a novelty. Leading companies are quoting at $150/ton or above. Cement growth continues to be strong, so valuations may not plummet to low end of the range. However, more downside than upside risk clearly

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A look at Cement

Posted by fairval on July 3, 2010

Cement Sector Wide Capacity Utilisation

Was checking some cement data. The industry is headed for its worst phase since 2002. Capacity utilisations could fall 77% or so, and stay low over FY11 and FY12.  Every single cement company is hiking capacity by say 50% between FY10 and FY12. About 40mn ton capacity is reportedly gone on stream in FY10, about half of it in Q4 FY10.

FY10 was still a good year, profits jumped, since much of capacity adds were backended. FY11 and FY12 could see margins drop. How much? Some historical data..

Cement EBITDA margins

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