Mangalam Cement: 1QFY17 Result: FIRST CUT - Reliance Securities

- Mangalam Cement (MCL) has reported a robust and better-than-expected operating performance in 1QFY17 as operating profit came in at Rs471mn (v/s loss of Rs40mn last year), which is higher than our estimate of Rs346mn.

- A better that expected improvement in realizations (+10% yoy) along with improved operating synergies led to better operating performance. Operating cost/tonne saw a decline of ~14% yoy mainly owing to significant dip in power and fuel costs (down by 34% yoy and ~7% qoq on per tonne basis)led by increased usage of petcoke.

- EBITDA/tonne stood strongly at Rs766 as against Rs462 reported in previous quarter.

- MCL's sales volume remained tepid (+1.7% yoy at 0.61mnT adjusted with leased grinding unit at Ghaziabad) with its endeavour to sell more in Rajasthan market so as to take maximum benefit of sales tax exemption.

- Net profit stood at Rs226mn v/s net loss of Rs289mn reported last year.

- We maintain our positive stance on the stock and it remains one of our top picks in cement mid-cap space. We will come out with a detailed note post the concall, which is scheduled on 8th July'16 at 4:00 PM.

Shares of MANGALAM CEMENT LTD. was last trading in BSE at Rs.292.65 as compared to the previous close of Rs. 279.15. The total number of shares traded during the day was 17738 in over 531 trades.

The stock hit an intraday high of Rs. 296.1 and intraday low of 281.3. The net turnover during the day was Rs. 5090711.

Source : Equity Bulls

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