Karvy Stock Broking has rated UltraTech Cement as an underperformer with target price of Rs 541 in its April 23, 2009 research report.
“UltraTech Cements Ltd. (UTCL)’s Q4FY09 result is broadly in line with our expectation. Net sale was lower than expectation by 2.9% to Rs 18.6 billion due to sharp decline in export price of cement and clinker. EBIDTA margin has improved by 230bps sequentially to 28.7% which is 90bps higher than our expectation on account of reduction in import coal price (40% of total coal consumption). Net profit came in higher than expectation at Rs 3.09 billion vs. our expectation of Rs 2.89 billion mainly due to lower tax and interest expense than our expectation. We have valued the company on EV/EBIDTA multiple of 6x and rate the company as underperformer with target price of Rs 541,” says Karvy Stock Broking’s research report.
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