Motilal Oswal Financial Services

24 May 2021

4QFY21 Results Update | Sector: Cement

India Cements

Neutral

Estimate change

TP change

Rating change

Bloomberg

Equity Shares (m)

M.Cap.(INRb)/(USDb)

52-Week Range (INR)

1, 6, 12 Rel. Per (%)

12M Avg Val (INR M)

CMP: INR196

TP: INR185 (-6%)

Deleveraging to continue in absence of capex

Better utilization awaited

ICEM IN



308

60.9 / 0.8

211 / 107

12/14/-17

458



Financial Snapshot (INR b)

Y/E MARCH

Sales

EBITDA

Adj. PAT

EBITDA Margin (%)

Adj. EPS (INR)

EPS Gr. (%)

BV/Sh. (INR)

Ratios

Net D:E

RoE (%)

RoCE (%)

Payout (%)

Valuations

P/E (x)

P/BV (x)

EV/EBITDA(x)

EV/ton (USD)

Div. Yield (%)

2021 2022E 2023E

44.4

50.5

57.3

8.1

7.1

8.2

2.2

1.6

2.4

18.2

14.1

14.3

7.2

5.2

7.7

947.7

-27.5

46.6

181.3 185.5 191.6

0.5

4.0

4.6

16.8

27.3

1.1

11.3

0.5

2.8

3.8

19.2

37.7

1.1

12.7

0.5

0.4

4.0

4.6

19.7

25.7

1.0

10.7

0.8

India Cements (ICEM)’s 4QFY21 EBITDA came in 4% below estimate due to

higher costs. This was partly attributable to higher selling in the faraway

markets of East and Central, which offset weaker demand in South – the

company’s core market. Capacity utilization stood at just 57% in FY21.

Net debt declined 15% YoY to INR30.0b in FY21 as the company repaid

INR5.3b worth of debt on strong OCF and negligible capex.

We raise our FY22E/FY23E EPS by 5%/17%, factoring in lower interest costs

from deleveraging as the company continues to delay its capex plans. It

trades at 10.7x FY23E EV/EBITDA, which factors in an improved earnings

outlook and lower leverage, in our view. We maintain

Neutral.

4Q EBITDA up 197% YoY, but misses estimate by 4%



Shareholding pattern (%)

As On

Promoter

DII

FII

Others

Mar-21 Dec-20 Mar-20

28.4

28.3

9.0

9.4

8.3

13.1

12.4

12.9

49.5

49.8

50.6



Revenue/EBITDA was up 26%/197% YoY to INR14.5b/INR2.0b (+11%/-4% v/s

our estimate). Adj. PAT came in at INR716m (v/s loss of INR476m in 4QFY20)

and beat our estimate by 20% – on the back of 43% YoY decline in finance

cost.

While volumes grew 13% YoY to 2.99mt (above estimate), EBITDA/t declined

26% QoQ to INR671, weighed by a 5% QoQ increase in cost/t to INR4,178.

The cost increase was attributable to higher sales in the faraway markets of

East and Central, higher freight cost (diesel price), and higher employee cost.

Blended realization rose 11% YoY to INR4,848/t (in line with est).

FY21 rev / EBITDA / adj. PAT stood at INR44.4b/INR8.1b/INR2.2b, with YoY

change of -12%/+38%/+9.48x. On the other hand, the EBITDA margin stood

at 18.2% v/s 11.6% in FY20. Volumes declined 19% YoY to 8.90mt, while

EBITDA/t was up 71% YoY to INR906/t.

FY21 OCF/capex/FCF stood at INR10.4b/INR1.3b/INR9.1b v/s

INR4.1b/INR1.4b/INR2.8b in FY20.

ICEM announced dividend of INR1/sh v/s INR0.6/sh in FY20.

FII Includes depository receipts

Highlights from management commentary



Utilization for 4QFY21/FY21 stood at 77%/57%. 4QFY21 sales volumes stood

at 2.99mt (including 0.6mt sold in East), while FY21 sales volumes stood at

8.9mt (including 0.45mt of clinker sales).

In FY21, the company shifted its focus to the cash-and-carry sales model and

collected old outstanding receivables (INR1.8b), leading to better cash flows.

It also utilized inventory worth INR2.4b.

Prices are up INR10/bag QoQ and have remained stable in April and May.

The management expects to see another round of price hikes at INR15/bag

in the first week of June. The sales volume offtake in May is lower v/s April.

The management has guided for power and fuel cost to remain flat QoQ in

1QFY22. Employee cost was higher in 4QFY21 and is expected to decline by

INR110m/quarter on a recurring basis.

Amit Murarka - Research analyst

(Amit.Murarka@motilaloswal.com)

Research analyst - Basant Joshi

(Basant.Joshi@motilaloswal.com);

Jayant Gautam

(Jayant.Gautam@motilaloswal.com)

Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

25 May 2021

Investors are advised to refer through important disclosures made at the last page of the Research Report.

India Cements



Gross debt stood at INR30.0b (v/s INR35.3b in Mar’20) as the company repaid

INR5.3b worth of debt. Repayment of INR6.0b is due in FY22, of which INR1.7b

would be repaid in 1QFY22. Blended cost of debt stands at 8.86% p.a.

Valuation and view



We expect ICEM’s market share loss in South to continue as key competitor

Ramco’s new capacities get commissioned within six months.

We expect net debt to decline further as the company continues to delay its

capex plans. Net debt declined 15% YoY to INR30.0b in FY21.

ICEM trades at 10.7x FY23E EV/EBITDA and USD77/t of EV/capacity. We value

the stock at 10x FY23 EV/EBITDA to arrive at TP of INR185. We maintain

Neutral.

FY21

2.11

2.38

-21

-11

5,077

4,881

8.7

9.3

-4.2

-3.9

10,697 11,603

-14.1

-2.6

2,347

2,152

21.9

18.5

601

605

705

685

1,098

889

1,098

889

384

268

34.9

30.2

714

620

714

620

1,327.2 -1,014.7

6.7

5.3

FY20

FY21

8.90

-19.2

4,985

8.6

44,367

-12.3

8,061

18.2

2,419

2,650

235

3,227

1,007

31.2

2,220

947.7

5.0

(INR m)

FY21

Var.

4QE

(%)

2.68

1.4

4,849

11.4

-0.7

13,013

13.0

2,083

-4

16.0

643

778

-32

131

794

199

25.0

595

-225.0

4.6

Quarterly Perf. (Standalone)

Y/E March

Sales Dispatches (m ton)

YoY Change (%)

Realization (INR/ton)

YoY Change (%)

QoQ Change (%)

Net Sales

YoY Change (%)

EBITDA

Margins (%)

Depreciation

Interest

Other Income

PBT before EO expense

Extra-Ord expense

PBT

Tax

Rate (%)

Reported PAT

Adj PAT

YoY Change (%)

Margins (%)

E: MOFSL Estimates

Per ton analysis

3.04

-1

4,828

9.1

2.8

14,688

7.9

2,420

16.5

599

799

1,054

331

31.5

722

706

235.8

4.8

FY20

2.67

-13

-10

4,671

4,468

3.6

0.4

-3.3

-4.3

12,457 11,911

-10.2

-9.5

1,472

1,287

11.8

10.8

613

615

816

806

-101

-13

-48

-16.7

46.9

-54

-68

250.0 -316.6

0.4

-0.6

2.65

-21

4,352

-7.3

-2.6

11,519

-26.3

675

5.9

642

924

180

-711

1,000

-1,711

-600

35.1

-1,111

-476

-208.6

-4.1

1.43

-53

5,301

9.8

21.8

7,570

-48.5

1,557

20.6

600

730

261

34.9

170

-76.0

2.2

2.99 11.02

13 -11.4

4,848 4,589

11.4

1.4

-0.7

14,496 50,575

25.8 -10.1

2,005 5,852

13.8

11.6

613 2,469

530 3,345

118

277

980

316

0 1,000

980

-684

264

(329)

26.9

48.1

716

-355

716

212

-250.4 -69.5

4.9

0.4

Sales Dispatches (m ton)

YoY Change (%)

Net Realizations

YoY (%)

RM Cost

Employee Expenses

Power, Oil & Fuel

Freight cost

Other Expenses

Total Exp

EBITDA

3.04

-1.1

4,828

9.1

851

324

1,240

1,058

559

4,033

795

FY20

2.67

-13.3

4,671

3.6

866

327

1,251

1,021

655

4,119

552

2.67

-9.9

4,468

0.4

869

325

1,150

1,039

603

3,985

483

2.65

-20.5

4,352

-7.3

681

292

1,275

1,090

758

4,097

255

1.43

-53.1

5,301

9.8

1,097

525

1,079

954

556

4,211

1,090

FY21

2.11

-21.0

5,077

8.7

924

350

1,102

1,023

564

3,963

1,114

2.38

-10.8

4,881

9.3

747

333

1,254

1,104

539

3,976

905

2.99

13.0

4,848

11.4

833

346

1,247

1,194

557

4,178

671

FY20

11.02

-11.4

4,589

1.4

818

318

1,230

1,052

641

4,058

531

FY21

8.90

-19.2

4,985

8.6

874

372

1,188

1,091

554

4,079

906

FY21

4QE

2.68

1.4

4,849

11.4

815

299

1,251

1,082

626

4,073

776

(INR/t)

Var.

(%)

-11

-14

24 May 2021

India Cements

Conference call highlights

Operational highlights



Utilization for 4QFY21/FY21 stood at 77%/57%, while it was 81% for Mar’21.



4QFY21 sales volumes stood at 2.99mt (including 0.6mt sold in East), while FY21

sales volumes stood at 8.9mt (including 0.45mt of clinker sales).



In 4QFY21, blended cement accounted for 59% of sales volumes and trade sales

accounted for 55% of sales volumes.



In FY21, the company shifted its focus to the cash-and-carry sales model and

collected old outstanding receivables, leading to improved cash flows.



In FY21, it collected INR1.8b worth of outstanding receivables and utilized

inventory worth INR2.4b.

Cost insights



The management expects power and fuel cost to remain flat QoQ in 1QFY22 as

the impact of higher prices was already reflected in 4QFY21.



Employee cost was higher in 4QFY21 and is expected to decline by

INR110m/quarter on a recurring basis.



Repair and maintenance cost was higher on account of higher sales volumes; it

should taper off over subsequent quarters.

Demand and pricing outlook



Prices are up INR10/bag QoQ and have remained stable in April and May.



The management expects to see another round of price hikes at INR15/bag in

the first week of June.



In FY21, industry volumes in South declined 15% YoY, while pan-India, volumes

were down 10% YoY.



The management expects demand to rebound sharply from June (factoring in

the easing of lockdowns).



The company expects to achieve higher utilization in 1QFY22 v/s 1QFY21 (at

33%).



The sales volume offtake in May is lower v/s April.

Debt and capex



Gross debt stood at INR30.0b (v/s INR35.3b in Mar’20) as the company repaid

INR5.3b worth of debt.



Repayment of INR6.0b is due in FY22, of which INR1.7b would be repaid in

1QFY22. Blended cost of debt stands at 8.86% p.a.



The company is yet to take a call on capex for Satna and is focused on improving

utilization at existing capacities.

Other highlights



The company has a captive power generation capacity of 170MW, including

120MW of thermal power, 5MW of wind power, 26MW of gas-based power,

and 8.5MW of WHRS (at Vishnupuram).

24 May 2021

India Cements

Key exhibits

Exhibit 1: Volumes up 13% YoY and realizations up 11% YoY

3.1

Realizations (INR/ton)

3.3

3.1

3.0

Volume (m ton)

3.0

2.7

2.6

2.1

1.4

3.0

2.4

2.7

Exhibit 2: Margins improve 8pp YoY

EBITDA (INR m)

EBITDA (%)

21.9

20.6

18.5

13.8

Exhibit 3: EBITDA/t (INR/t) up 163% YoY / down 26% QoQ

EBITDA (INR/Ton)

16.5

14.414.313.8

12.3

11.810.8

11.311.511.2

10.2

5.9

Source: Company, MOFSL

Exhibit 4: Key operating indicators (incl. other businesses)

INR/Ton

Net realization

Expenditure

RM Cost

Staff Cost

Energy Cost

Selling Exp.

Other Exp.

Total Exp.

EBITDA

4QFY21

4,848

833

346

1,247

1,194

557

4,178

671

4QFY20

4,352

681

292

1,275

1,090

758

4,097

255

YoY (%)

11.4%

22.3%

18.2%

-2.2%

9.6%

-26.5%

2.0%

163.2%

3QFY21

4,881

747

333

1,254

1,104

539

3,976

905

QoQ (%)

-0.7%

11.5%

4.0%

-0.5%

8.2%

3.4%

5.1%

-25.9%

24 May 2021

India Cements

Valuation and view



With ~80% of its capacity in South, ICEM has good brand recall in the region.

Also, it is one of the most leveraged plays on price recovery in South. We note

that for every INR10/t price hike, EPS for ICEM increases by ~5%.

We expect ICEM’s market share loss in South to continue as key competitor

Ramco’s new capacities get commissioned within six months.

We expect net debt to decline further as the company continues to delay its

capex plans. Net debt declined 15% YoY to INR30.0b in FY21.

The planned capacity expansion at the Satna cluster provides option value as it

would diversify the market mix in favor of the stronger market, i.e., Central.

ICEM trades at 10.7x FY23E EV/EBITDA and USD77/t of EV/capacity. We value

the stock at 10x FY23E EV/EBITDA to arrive at Target Price of INR185. We

maintain

Neutral.

24 May 2021

India Cements

Story in charts

Exhibit 5: Capacity utilization to improve

Capacity (mt)

6,648 7,754 8,610 6,928 6,379 5,852 8,061 7,116 8,205

FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22E FY23E

Source: Company, MOFSL

FY15

FY16

FY17

FY18

FY19

FY20

FY21 FY22E FY23E

Despatch (mt)

Utilization (%)

15.0

16.1

Exhibit 6: EBITDA and margins to decline

EBITDA (INR mn)

17.0

13.4

11.3 11.6

Margin (%)

18.2

14.1 14.3

Source: Company, MOFSL

Exhibit 7: Net debt profile

Net debt (INR b)

5.4

4.1

2.6

4.1

3.4

4.5

5.3

Net Debt/EBITDA

6.0

3.7

4.1

Exhibit 8: RoE/RoIC profile

5.7

4.8

3.2

3.1

3.4

4.7

RoE (%)

4.4

3.2

1.9

2.0

FY16

FY17

FY18

RoIC (%)

4.2

4.0

4.2

3.4

4.0

2.8

0.3

FY15

1.3

FY19

0.4

FY20

FY21 FY22E FY23E

Source: Company, MOFSL

Exhibit 9: ICEM’s EV/EBITDA trend

EV/EBITDA(x)

Peak(x)

Avg(x)

Min(x)

Exhibit 10: ICEM EV/ton trend

EV/ton (US$)

100

Max

Avg

Min

Source: MOFSL, Company

24 May 2021

India Cements

Financials and valuations

Standalone Income Statement

Y/E March

Net Sales

Change (%)

EBITDA

Margin (%)

Depreciation

EBIT

Int. and Finance Charges

Other Income - Rec.

PBT bef. EO Exp.

EO Expense/(Income)

PBT after EO Exp.

Current Tax

Deferred Tax

Tax Rate (%)

Reported PAT

PAT Adj for EO items

Change (%)

Margin (%)

2016

48,114

8.8

7,754

16.1

2,195

5,560

3,825

221

1,956

1,924

625

32.5

1,299

1,321

1,024.8

2.7

2017

50,795

5.6

8,610

17.0

2,571

6,040

3,605

165

2,600

867

33.3

1,734

31.3

3.4

2018

51,692

1.8

6,928

13.4

2,559

4,369

3,402

194

1,161

179

-24

13.3

1,006

-42.0

1.9

2019

56,280

8.9

6,379

11.3

2,513

3,866

3,242

310

934

325

-85

25.7

694

-31.0

1.2

2020

50,575

-10.1

5,852

11.6

2,469

3,384

3,345

277

316

1,000

-684

-398

48.1

-355

212

-69.5

0.4

2021

44,367

-12.3

8,061

18.2

2,419

5,642

2,650

235

3,227

1,380

-373

31.2

2,220

947.7

5.0

2022E

50,546

13.9

7,116

14.1

2,569

4,548

2,439

260

2,368

758

32.0

1,611

-27.5

3.2

(INR m)

2023E

57,259

13.3

8,205

14.3

2,615

5,590

2,377

261

3,473

1,111

32.0

2,362

46.6

4.1

Balance Sheet

Y/E March

Equity Share Capital

Total Reserves

Net Worth

Deferred Liabilities

Secured Loan

Unsecured Loan

Total Loans

Capital Employed

Gross Block

Less: Accum. Deprn.

Net Fixed Assets

Capital WIP

Total Investments

Curr. Assets, Loans&Adv.

Inventory

Account Receivables

Cash and Bank Balance

Loans and Advances

Real Estate Projects WIP

Curr. Liability & Prov.

Account Payables

Other Current Liabilities

Provisions

Net Current Assets

Appl. of Funds

2016

3,082

46,728

49,809

5,719

21,331

10,218

31,549

87,077

74,536

2,712

71,824

926

5,507

25,364

5,994

5,359

13,945

16,544

10,367

4,569

1,609

8,820

87,077

2017

3,082

48,018

51,099

6,556

23,797

5,416

29,213

86,868

75,015

5,286

69,729

1,278

6,190

29,256

7,450

5,089

16,649

19,584

13,180

4,796

1,608

9,671

86,868

2018

3,082

48,922

52,003

6,532

28,180

3,049

31,229

89,764

75,794

7,831

67,963

1,712

5,884

31,700

6,723

6,295

18,599

17,495

11,759

4,307

1,428

14,205

89,764

2019

3,099

49,298

52,397

6,308

26,433

7,237

33,670

92,375

77,438

10,308

67,130

1,770

6,946

35,203

8,232

7,290

19,614

18,675

13,163

4,106

1,405

16,528

92,375

2020

3,099

51,050

54,149

5,910

23,750

11,581

35,331

95,391

81,024

12,766

68,258

1,958

7,369

36,939

8,263

7,163

21,447

19,134

13,342

4,566

1,225

17,805

95,391

2021

3,099

53,081

56,180

5,538

19,798

10,192

29,990

91,707

82,114

15,414

66,700

1,871

7,462

32,708

5,838

5,413

21,390

17,033

10,763

5,306

964

15,675

91,707

2022E

3,099

54,380

57,479

5,538

19,298

10,192

29,490

92,507

83,614

17,984

65,629

1,871

7,462

35,126

6,232

273

22,390

17,582

11,771

4,847

964

17,544

92,507

(INR m)

2023E

3,099

56,275

59,374

5,538

18,298

10,192

28,490

93,402

85,114

20,602

64,512

1,871

7,462

39,344

7,059

1,835

23,390

19,789

13,334

5,491

964

19,554

93,402

24 May 2021

India Cements

Financials and valuations

Ratios

Y/E March

Basic (INR)

Standalone EPS

Cash EPS

BV/Share

DPS

Payout (%)

Valuation (x)

P/E

Cash P/E

P/BV

EV/Sales

EV/EBITDA

EV/Ton (US$)

Dividend Yield (%)

Return Ratios (%)

RoIC

RoE

RoCE

Working Capital Ratios

Asset Turnover (x)

Inventory (Days)

Debtor (Days)

Leverage Ratio (x)

Current Ratio

Debt/Equity

2016

4.3

11.4

161.6

0.0

2017

5.6

14.0

165.8

1.0

21.4

2018

3.3

11.6

168.8

0.8

29.5

60.3

17.0

1.2

1.8

13.3

80.63

0.4

4.8

3.1

5.2

0.6

45.5

1.5

0.6

4.7

3.4

5.1

0.6

53.5

1.5

0.6

4.4

2.0

4.8

0.6

47.5

1.8

0.6

2019

2.3

10.4

169.1

0.8

43.0

87.4

19.0

1.2

1.7

14.8

83.09

0.4

3.2

1.3

3.7

0.6

53.4

1.9

0.6

2020

0.7

8.6

174.7

0.6

-52.4

286.5

22.8

1.1

1.9

16.5

84.55

0.3

1.9

0.4

2.2

0.5

59.6

1.9

0.7

2021

7.2

15.0

181.3

1.0

16.8

27.3

13.2

1.1

2.1

11.3

79.86

0.5

4.2

4.0

4.6

0.5

48.0

1.9

0.5

2022E

5.2

13.5

185.5

1.0

19.2

37.7

14.6

1.1

1.8

12.7

79.24

0.5

3.4

2.8

3.8

0.5

45.0

2.0

0.5

2023E

7.7

16.1

191.6

1.5

19.7

25.7

12.3

1.0

1.5

10.7

76.99

0.8

4.2

4.0

4.6

0.6

45.0

2.0

0.5

Cash Flow Statement

Y/E March

OP/(Loss) before Tax

Depreciation

Interest & Finance Charges

Direct Taxes Paid

(Inc)/Dec in WC

CF from Operations

Others

CF from Operating incl EO

(Inc)/Dec in FA

Free Cash Flow

(Pur)/Sale of Investments

Others

CF from Investments

Issue of Shares

Inc/(Dec) in Debt

Interest Paid

Dividend Paid

Others

CF from Fin. Activity

Inc/Dec of Cash

Opening Balance

Closing Balance

2016

1,910

2,693

3,652

-55

767

8,966

204

9,169

-1,598

7,571

430

-1,162

3,463

-5,042

-2

-6,398

-7,979

2017

2,517

2,571

3,528

-637

112

8,090

8,121

-788

7,332

-683

-405

-1,876

16,880

-3,537

-370

-19,217

-6,243

2018

1,257

2,559

3,220

-384

-2,072

4,580

105

4,685

-1,902

2,783

344

-1,385

-2,942

9,583

-3,411

-371

-7,528

-1,727

2019

853

2,513

3,074

-88

-3,069

3,283

-119

3,164

-1,712

1,452

-923

231

-2,404

5,424

-3,136

-336

-2,746

-776

-16

2020

282

2,469

3,050

-312

-1,269

4,220

-81

4,139

-1,365

2,774

-278

-1,759

-3,403

2,562

-3,000

-300

-738

-1

2021

3,221

2,419

2,591

-507

2,592

10,317

10,356

-1,256

9,100

-708

-1,958

-5,401

-2,809

-187

-8,396

2022E

2,368

2,569

2,439

-758

-1,664

4,954

-1,500

3,454

-1,500

-500

-2,439

-311

-3,250

205

273

(INR m)

2023E

3,473

2,615

2,377

-1,111

-448

6,906

-1,500

5,406

-1,500

-1,000

-2,377

-467

-3,844

1,562

273

1,835

24 May 2021

India Cements

Explanation of Investment Rating

Investment Rating

Expected return (over 12-month)

BUY

>=15%

SELL

< - 10%

NEUTRAL

< - 10 % to 15%

UNDER REVIEW

Rating may undergo a change

NOT RATED

We have forward looking estimates for the stock but we refrain from assigning recommendation

*In case the recommendation given by the Research Analyst is inconsistent with the investment rating legend for a continuous period of 30 days, the Research Analyst shall within

following 30 days take appropriate measures to make the recommendation consistent with the investment rating legend.

Disclosures

The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).

Motilal Oswal Financial Services Ltd. (MOFSL) is a SEBI Registered Research Analyst having registration no. INH000000412. MOFSL, the Research Entity (RE) as defined in the

Regulations, is engaged in the business of providing Stock broking services, Investment Advisory Services, Depository participant services & distribution of various financial

products. MOFSL is a subsidiary company of Passionate Investment Management Pvt. Ltd.. (PIMPL). MOFSL is a listed public company, the details in respect of which are

available on www.motilaloswal.com. MOFSL (erstwhile Motilal Oswal Securities Limited - MOSL) is registered with the Securities & Exchange Board of India (SEBI) and is a

registered Trading Member with National Stock Exchange of India Ltd. (NSE) and Bombay Stock Exchange Limited (BSE), Multi Commodity Exchange of India Limited (MCX) and

National Commodity & Derivatives Exchange Limited (NCDEX) for its stock broking activities & is Depository participant with Central Depository Services Limited (CDSL) National

Securities Depository Limited (NSDL),NERL, COMRIS and CCRL and is member of Association of Mutual Funds of India (AMFI) for distribution of financial products and Insurance

Regulatory & Development Authority of India (IRDA) as Corporate Agent for insurance products.

Details of associate entities of Motilal Oswal Financial Services Limited are

available on the website at

http://onlinereports.motilaloswal.com/Dormant/documents/List%20of%20Associate%20companies.pdf

MOFSL and its associate company(ies), their directors and Research Analyst and their relatives may; (a) from time to time, have a long or short position in, act as principal in, and

buy or sell the securities or derivatives thereof of companies mentioned herein. (b) be engaged in any other transaction involving such securities and earn brokerage or other

compensation or act as a market maker in the financial instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have

any other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the

specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even

though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report

MOFSL and / or its affiliates do and seek to do business including investment banking with companies covered in its research reports. As a result, the recipients of this report

should be aware that MOFSL may have a potential conflict of interest that may affect the objectivity of this report. Compensation of Research Analysts is not based on any specific

merchant banking, investment banking or brokerage service transactions. Details of pending Enquiry Proceedings of Motilal Oswal Financial Services Limited are available on the

website at

https://galaxy.motilaloswal.com/ResearchAnalyst/PublishViewLitigation.aspx

A graph of daily closing prices of securities is available at

www.nseindia.com, www.bseindia.com.

Research Analyst views on Subject Company may vary based on Fundamental

research and Technical Research. Proprietary trading desk of MOFSL or its associates maintains arm’s length distance with Research Team as all the activities are segregated

from MOFSL research activity and therefore it can have an independent view with regards to Subject Company for which Research Team have expressed their views.

Regional Disclosures (outside India)

This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability

or use would be contrary to law, regulation or which would subject MOFSL & its group companies to registration or licensing requirements within such jurisdictions.

For Hong Kong:

This report is distributed in Hong Kong by Motilal Oswal capital Markets (Hong Kong) Private Limited, a licensed corporation (CE AYY-301) licensed and regulated by the Hong

Kong Securities and Futures Commission (SFC) pursuant to the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) “SFO”. As per SEBI (Research Analyst

Regulations) 2014 Motilal Oswal Securities (SEBI Reg No. INH000000412) has an agreement with Motilal Oswal capital Markets (Hong Kong) Private Limited for distribution of

research report in Hong Kong. This report is intended for distribution only to “Professional Investors” as defined in Part I of Schedule 1 to SFO. Any investment or investment activity

to which this document relates is only available to professional investor and will be engaged only with professional investors.” Nothing here is an offer or solicitation of these

securities, products and services in any jurisdiction where their offer or sale is not qualified or exempt from registration. The Indian Analyst(s) who compile this report is/are not

located in Hong Kong & are not conducting Research Analysis in Hong Kong.

For U.S.

Motilal Oswal Financial Services Limited (MOFSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under

applicable state laws in the United States. In addition MOFSL is not a registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers

Act" and together with the 1934 Act, the "Acts), and under applicable state laws in the United States. Accordingly, in the absence of specific exemption under the Acts, any

brokerage and investment services provided by MOFSL , including the products and services described herein are not available to or intended for U.S. persons. This report is

intended for distribution only to "Major Institutional Investors" as defined by Rule 15a-6(b)(4) of the Exchange Act and interpretations thereof by SEC (henceforth referred to as

"major institutional investors"). This document must not be acted on or relied on by persons who are not major institutional investors. Any investment or investment activity to which

this document relates is only available to major institutional investors and will be engaged in only with major institutional investors. In reliance on the exemption from registration

provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act") and interpretations thereof by the U.S. Securities and Exchange

Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S., MOFSL has entered into a chaperoning agreement with a U.S. registered broker-

dealer, Motilal Oswal Securities International Private Limited. ("MOSIPL"). Any business interaction pursuant to this report will have to be executed within the provisions of this

chaperoning agreement.

The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S.

registered broker-dealer, MOSIPL, and therefore, may not be subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public

appearances and trading securities held by a research analyst account.

For Singapore

In Singapore, this report is being distributed by Motilal Oswal Capital Markets Singapore Pte Ltd (“MOCMSPL”) (Co.Reg. NO. 201129401Z) which is a holder of a capital markets

services license and an exempt financial adviser in Singapore.As per the approved agreement under Paragraph 9 of Third Schedule of Securities and Futures Act (CAP 289) and

Paragraph 11 of First Schedule of Financial Advisors Act (CAP 110) provided to MOCMSPL by Monetary Authority of Singapore. Persons in Singapore should contact MOCMSPL

in respect of any matter arising from, or in connection with this report/publication/communication. This report is distributed solely to persons who qualify as “Institutional Investors”,

of which some of whom may consist of "accredited" institutional investors as defined in section 4A(1) of the Securities and Futures Act, Chapter 289 of Singapore (“the

SFA”). Accordingly, if a Singapore person is not or ceases to be such an institutional investor, such Singapore Person must immediately discontinue any use of this Report and

inform MOCMSPL.

Specific Disclosures

1 MOFSL, Research Analyst and/or his relatives does not have financial interest in the subject company, as they do not have equity holdings in the subject company.

2 MOFSL, Research Analyst and/or his relatives do not have actual/beneficial ownership of 1% or more securities in the subject company

3 MOFSL, Research Analyst and/or his relatives have not received compensation/other benefits from the subject company in the past 12 months

4 MOFSL, Research Analyst and/or his relatives do not have material conflict of interest in the subject company at the time of publication of research report

5 Research Analyst has not served as director/officer/employee in the subject company

6 MOFSL has not acted as a manager or co-manager of public offering of securities of the subject company in past 12 months

7 MOFSL has not received compensation for investment banking/ merchant banking/brokerage services from the subject company in the past 12 months

8 MOFSL has not received compensation for other than investment banking/merchant banking/brokerage services from the subject company in the past 12 months

9 MOFSL has not received any compensation or other benefits from third party in connection with the research report

10 MOFSL has not engaged in market making activity for the subject company

24 May 2021

India Cements

********************************************************************************************************************************

The associates of MOFSL may have:

- financial interest in the subject company

- actual/beneficial ownership of 1% or more securities in the subject company

- received compensation/other benefits from the subject company in the past 12 months

- other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the

specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even

though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report.

- acted as a manager or co-manager of public offering of securities of the subject company in past 12 months

- be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the

company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies)

- received compensation from the subject company in the past 12 months for investment banking / merchant banking / brokerage services or from other than said services.

The associates of MOFSL has not received any compensation or other benefits from third party in connection with the research report

Above disclosures include beneficial holdings lying in demat account of MOFSL which are opened for proprietary investments only. While calculating beneficial holdings, It does not

consider demat accounts which are opened in name of MOFSL for other purposes (i.e holding client securities, collaterals, error trades etc.). MOFSL also earns DP income from

clients which are not considered in above disclosures.

Analyst Certification

The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the

research analyst(s) was, is, or will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report.

Terms & Conditions:

This report has been prepared by MOFSL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and

may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent

of MOFSL. The report is based on the facts, figures and information that are considered true, correct, reliable and accurate. The intent of this report is not recommendatory in

nature. The information is obtained from publicly available media or other sources believed to be reliable. Such information has not been independently verified and no guaranty,

representation of warranty, express or implied, is made as to its accuracy, completeness or correctness. All such information and opinions are subject to change without notice. The

report is prepared solely for informational purpose and does not constitute an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial

instruments for the clients. Though disseminated to all the customers simultaneously, not all customers may receive this report at the same time. MOFSL will not treat recipients as

customers by virtue of their receiving this report.

Disclaimer:

The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or

distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent. This report and information herein is solely for

informational purpose and may not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments. Nothing

in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances.

The securities discussed and opinions expressed in this report may not be suitable for all investors, who must make their own investment decisions, based on their own investment

objectives, financial positions and needs of specific recipient. This may not be taken in substitution for the exercise of independent judgment by any recipient. Each recipient of this

document should make such investigations as it deems necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this

document (including the merits and risks involved), and should consult its own advisors to determine the merits and risks of such an investment. The investment discussed or views

expressed may not be suitable for all investors. Certain transactions -including those involving futures, options, another derivative products as well as non-investment grade

securities - involve substantial risk and are not suitable for all investors. No representation or warranty, express or implied, is made as to the accuracy, completeness or fairness of

the information and opinions contained in this document. The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the transparency and

should not be treated as endorsement of the views expressed in the report. This information is subject to change without any prior notice. The Company reserves the right to make

modifications and alternations to this statement as may be required from time to time without any prior approval. MOFSL, its associates, their directors and the employees may from

time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities mentioned in this document. They may perform or seek to

perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities functions as a

separate, distinct and independent of each other. The recipient should take this into account before interpreting the document. This report has been prepared on the basis of

information that is already available in publicly accessible media or developed through analysis of MOFSL. The views expressed are those of the analyst, and the Company may or

may not subscribe to all the views expressed therein. This document is being supplied to you solely for your information and may not be reproduced, redistributed or passed on,

directly or indirectly, to any other person or published, copied, in whole or in part, for any purpose. This report is not directed or intended for distribution to, or use by, any person or

entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law,

regulation or which would subject MOFSL to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in

all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction.

Neither the Firm, not its directors, employees, agents or representatives shall be liable for any damages whether direct or indirect, incidental, special or consequential including lost

revenue or lost profits that may arise from or in connection with the use of the information.

The person accessing this information specifically agrees to exempt MOFSL or any of its

affiliates or employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MOFSL or any of its affiliates or employees responsible for any such

misuse and further agrees to hold MOFSL or any of its affiliates or employees free and harmless from all losses, costs, damages,

expenses that may be suffered by the person

accessing this information due to any errors and delays.

Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022 71934200/ 022-71934263;

Website

www.motilaloswal.com.CIN

no.: L67190MH2005PLC153397.Correspondence Office Address: Palm Spring Centre, 2nd Floor, Palm Court Complex, New Link Road,

Malad(West), Mumbai- 400 064. Tel No: 022 7188 1000.

Registration Nos.: Motilal Oswal Financial Services Limited (MOFSL)*: INZ000158836(BSE/NSE/MCX/NCDEX); CDSL and NSDL: IN-DP-16-2015; Research Analyst:

INH000000412. AMFI: ARN - 146822; Investment Adviser: INA000007100; Insurance Corporate Agent: CA0579;PMS:INP000006712. Motilal Oswal Asset Management Company

Ltd. (MOAMC): PMS (Registration No.: INP000000670); PMS and Mutual Funds are offered through MOAMC which is group company of MOFSL. Motilal Oswal Wealth

Management Ltd. (MOWML): PMS (Registration No.: INP000004409) is offered through MOWML, which is a group company of MOFSL. Motilal Oswal Financial Services Limited is

a distributor of Mutual Funds, PMS, Fixed Deposit, Bond, NCDs,Insurance Products and IPOs.Real Estate is offered through Motilal Oswal Real Estate Investment Advisors II Pvt.

Ltd. which is a group company of MOFSL. Private Equity is offered through Motilal Oswal Private Equity Investment Advisors Pvt. Ltd which is a group company of MOFSL.

Research & Advisory services is backed by proper research. Please read the Risk Disclosure Document prescribed by the Stock Exchanges carefully before investing. There is no

assurance or guarantee of the returns. Investment in securities market is subject to market risk, read all the related documents carefully before investing. Details of Compliance

Officer: Name: Neeraj Agarwal, Email ID: na@motilaloswal.com, Contact No.:022-71881085.

* MOSL has been amalgamated with Motilal Oswal Financial Services Limited (MOFSL) w.e.f August 21, 2018 pursuant to order dated July 30, 2018 issued by Hon'ble National

Company Law Tribunal, Mumbai Bench.

24 May 2021