Cera Sanitaryware Rated Buy with Target Price of Rs 7429: Prabhudas Lilladher

Cera Sanitaryware Maintains Growth Momentum, Upgrades Earnings Estimates

Cera Sanitaryware (CRS) has reported a strong Q4FY26 performance, with revenue growth reaching double digits. The company's research report by Prabhudas Lilladher highlights that CRS expects similar growth in the coming quarters. In Q4FY26, the EBITDA margin contracted due to higher trade discounts and rising brass costs. However, with price hikes implemented in the sanitaryware and faucetware segments, the company expects the margin to remain stable at 14-15% in FY27.

The company has taken price hikes of approximately 12% in the sanitaryware segment and 16% in the faucetware segment in Q4FY26. CRS has guided for FY27 revenue growth of 18-20%, driven primarily by 18% growth in faucetware, 12% growth in sanitaryware, and a meaningful contribution from the Senator and Polypluz brands.

Upgraded Earnings Estimates

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In response to the company's performance, Prabhudas Lilladher has upgraded its earnings estimates by 5.5% for FY27 and 6.8% for FY28. The research firm estimates a revenue compound annual growth rate (CAGR) of 16.3%, EBITDA CAGR of 20.9%, and PAT CAGR of 24.1% over FY26-28E.

Maintained 'BUY' Rating and Target Price

Based on the analysis, Prabhudas Lilladher maintains its 'BUY' rating for CRS with a target price of INR 7,429, based on 30x Mar'28 earnings.