Dalmia Bharat (DALBHARAT) Q4 16/17 earnings summary

Executive summary

• FY17 cement volume, including clinker, reached 15.3 MnT vs 12.8 MnT in FY16, up 20% while the Indian cement sector declined 1%.

• Installed capacity stood at 25 MnT across 11 locations in eight states; sales reached 21 states, with market share gains across key operating regions.

• Consolidated PAT rose 81% to ₹344.80 crore; net debt/EBITDA improved to 2.8x from 3.8x in FY16.

Financial highlights

• Consolidated gross revenue increased 15% to ₹8,348.10 crore from ₹7,262.15 crore; net revenue after excise duty was ₹7,431.66 crore.

• EBITDA rose 19.5% to ₹1,902 crore from ₹1,592 crore; PBT increased 38.8% to ₹707.96 crore from ₹510.04 crore.

• Net profit was ₹344.80 crore vs ₹190.01 crore; basic EPS increased to ₹38.81 from ₹23.26.

• Operating cash flow was ₹1,717.64 crore; cash and cash equivalents were ₹2,816 crore at March 31, 2017.

• Power and fuel cost per tonne declined to ₹608 from ₹649; variable cost was ₹1,320 per tonne, among the lowest in the industry.

Outlook and guidance

• Expected demand strength rests on government infrastructure spending and affordable housing; plans focus on higher asset utilisation and sweating existing capacity.

• Priorities include increasing Dalmia DSP contribution, lowering power use per tonne and logistics costs, improving kiln productivity, and optimising heat rates.

• Management anticipated a gradual pickup in private capex, housing demand from rising incomes and stronger infrastructure spending from higher tax collections.