Anand Rathi's research report on Cera Sanitaryware
Cera Sanitaryware reported a flat revenue of ~Rs4.9bn in Q2 FY26, largely due to subdued retail environment and poor performance of faucetware. Gross profit declined 3.7% y/y to ~Rs2.5bn, led by elevated input cost. Despite high employee expenses, decline in EBITDA was arrested at Rs671m (down 3.5% y/y), owing to lower other operating expenses. However, PAT tumbled 16.8% y/y to Rs566m due to onetime deferred tax income recognised in previous year. Management targets 10-12% growth in H2 FY26 and 7-8% growth in FY26.
Outlook
Expecting revenue/earnings to clock 8.9/11.8% CAGR over FY25-28, we maintain BUY rating on the stock with a 12-mth TP of Rs8,443 (from Rs8,956 earlier), valuing it at 35x FY27e/FY28e average EPS.
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Cera Sanitaryware - 25112025 - anand