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Axis Securities Report
In FY22, JK Cement Ltd. registered a cement sales volume of 14.04 million tonnes per annum, up 16% YoY from 12.04 mtpa in FY21. Grey and white cement volume grew by 9% and 8% respectively.
The growth was driven by a superior demand environment in both trade as well as non-trade segments.
JK Cement’s Ebitda margins declined to 18.6% in FY22 from 23.3% in FY21, registering a de-growth of 470 bps. This was primarily owing to the overall elevated costs which were up 10% YoY on a tonne basis to Rs 4,643.
The higher costs were on account of higher energy costs, which were up 31% YoY on a per tonne basis. In response, JK Cement implemented several measures to improve efficiencies and leverage input cost levers across the chain to contain costs.
The company’s blended realisation improved by 4% in FY22 to Rs 5,700/tonne. Its operating cash flow, however, declined to Rs 879 crore from Rs 1,590 crore in FY21 as higher costs during the year contracted its profitability and intensified working capital requirement.
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