Building Material Q3 Results Preview - Tepid Quarter Likely: ICICI Securities

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .ICICI Securities Report.Building material companies under our coverage are expected to report a tepid quarter (Q3 FY23) YoY with both revenue and Ebitda being subdued across segments due to high base. Volume growth across sectors (barring pipe segment) is likely to be tepid YoY/QoQ due to high base and softness in demand as inflationary pressures remained high. In Q3, tile companies under our coverage (Kajaria Ceramics Ltd., Somany Ceramics Ltd.) are expected to witness volume growth of (down 0.6)%/up 1.4% YoY on a high base (three-year compound annual growth rate of 7.7%/5.9%) with operating margins improving QoQ (up 191 bps/+110 bps) led by the easing of gas cost. In plywood segment, we expect volume growth of 3.8% to 8.9% YoY (three-year CAGR: 4.1% to 11.9%) with operating margins declining QoQ on continued raw material cost pressures. In MDF, we expect margins to be under pressure due to higher raw material cost and tepid volume growth on account of a significant pick-up in imports (due to weak global demand, lower ocean freight rate and higher container availability). For pipe companies, we estimate volume to grow by 18-32% YoY (three-year CAGR: 2.3% to 9.1%) as pvc prices stabilised in Q3 (closer to its 10-year average). .Click on the attachment to read the full report:.Oil & Gas Q3 Results Preview - A Sharp Turnaround From Q2: ICICI Securities.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Building Material Q3 Results Preview - Tepid Quarter Likely: ICICI Securities

Volume growth across sectors (barring pipe segment) is likely to be tepid YoY/QoQ due to high base and softness in demand.

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