FY15 EBIT for board business was 30% of overall EBIT. Revenue was 15%+ of total revenue for FY15. This business has been growing at more than 20% with margins of 17% odd.
I had also read in ET that this business can be valued at 150-175 Crs.
Even if we value this business at 150 Crs and deduct the same from current mkt cap of 467 Crs. then the residual business is still available at 317 Crs. or EV of 455 Crs. (If I don’t allocate any debt towards board business) or EV/EBITDA (FY16-arrived at by extrapolating FY16Q1 nos. This might be naive and too layman but I think safe assumption as capacity utilisation will go up and prices may hold) of 4.6-4.8 times or EV/Tonne of 38-40 US$ odd, which I think is still not expensive, considering that the cement business has good earnings visibility and better times ahead.
Figures are approximations.
Discl: Invested & maybe biased.
| Subscribe To Our Free Newsletter |
