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Anand Rathi
Sagar Cements (Buy)
CMP: ₹715.05
Target: ₹1,025
Sagar Cements is engaged in the manufacture of cement. The company is also engaged in the business of cement and cement-related products.
Volume growth optimised lead distance and on-time capacity ramp-up helped Sagar Cements hold to its average revenue growth and save on high costs. Also, with the coming savings in power cost (through its own power plant) and a better product mix, we expect cost reductions to continue, although lower cement prices continue to cut into profitability. We retain Sagar as our top pick, with a Buy rating while raising our price target to ₹1,025.
Risk: Rising pet coke and diesel prices.
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