Accumulate Cera Sanitaryware; target of Rs 8486: Prabhudas Lilladher

Prabhudas Lilladher's research report on Cera Sanitaryware

We met with the management of Cera Sanitaryware Ltd. (CRS) to assess the demand, competition, pricing, and capacity expansion. Management continues to observe a slowdown in demand in the near term and is expected to review its revenue guidance of Rs25bn/Rs29bn by Mar-25/Sep-25 with ~16%+ EBITDA margin, following the conclusion of FY24. We also believe demand scenario will continue to remain subdued in the near term, while CRS expected some improvement with recent capacity expansion in faucetware division in FY25.

Outlook

We estimate Revenue/ EBITDA /PAT CAGR of 18.2%/22.3%/20.9% over FY24-26E. We maintain ‘Accumulate’ rating, as we value the stock at 35x Dec’25 EPS to arrive at TP of Rs8,486.

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Cera Sanitaryware - 21032024 - prabhu