Cera Sanitaryware - Stock Update

I was reading the latest annual report for Cera and I am capturing the key points here:

• Company’s brand extension to other related categories like showers, faucets, PVC cisterns and seat covers has helped in accelerating the growth.
• This year Cera forayed into tiles in a modest way and launched digital wall and floor tiles, vitrified tiles in both soluble salt and double charge and also regular porcelain tiles.
• Even though there was significant drop in construction sector in the fiscal under review, Cera was unaffected by sporadic upheavals in construction activities because of its well-established mid-segment product positioning in the market. The demand in mid-segment housing is likely to be least affected by any impending slow-down and hence the company is confident of maintaining its growth rate.
• Vikram Somany got a total salary of 3.3cr which was up from 2.5 cr last fiscal.
• Promoters hold 55.5% of the stock (no major change since last year)
• Revenues of 487 cr and Net Profit of 46.21 cr.
• EPS was 36.51 up from 25.32 a year back (up 44.91%)
• Paid a dividend of Rs 4, up from Rs 3 in 2011-12.

FY14E EPS ~ 40-41

FY15E EPS ~ 52-53

Expected PE range (low – high) – 10-15

I am expecting a price of close to 600 at FY14 end, which is about 13% up from the CMP of 530. And

750 by FY15, which is about 40% higher from current levels. A good buying zone is 450-475, if the price gets to that level. I would NOT buy at current levels.

Disclosure: I am invested in Cera Sanitaryware and have a vested interest in the stock.