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Birla Corp shares surge 20% post Q4 results — Five factors that work in its favourOut of the 21 analysts that have coverage on Birla Corporation, 18 of them have a "buy" rating on the stock, while three have a "hold" rating.By Nigel D'Souza    | Hormaz Fatakia   May 12, 2025, 10:28:03 AM IST (Published)2 Min ReadShares of Birla Corporation, the manufacturer of cement, automobile trim parts, jute goods, synthetic and cotton yarns and PVC floor coverings, surged as much as 20% on Monday, May 12, in reaction to its fourth quarter results.

Birla Corp's results were a beat on expectations due to lower costs and an improvement in realisations on a sequential basis. Its revenue increased by 6.1% from last year, while its net profit was up 33% on a year-on-year basis.

Here are five factors that are currently working for the company:

One, its cement realisations went up by 7% on a sequential basis. Its Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) per tonne, went up to ₹1,014 from ₹569 in the December quarter and from ₹964 in the same quarter last year.

Two, its EBITDA per tonne was the highest in the last 18 quarters. The cement volumes for the quarter also increased to 5.25 million tonnes, from 4.5 million tonnes in the previous quarter and 4.85 million tonnes during the same quarter last year.

Three, the company has seen a significant reduction in its net debt when compared to the previous quarter. Its net debt at the end of the March quarter came down to ₹2,244 crore from ₹3,003 crore during the same quarter last year. The reduction in debt has resulted in the company's cost of borrowing declining by 35 basis points from last year.

Four, the board of the company has also approved capacity expansion plans over the next four years. The company plans on increasing capacity from 20 MTPA currently to 27.6 MTPA by financial year 2029. Birla Corp will be spending ₹4,330 crore for this expansion, which will be done at a an Enterprise Value per tonne cost of $82.

and lastly, favourable valuations for the stock are also working in its favour. As of Friday's close, the stock traded at $65 per tonne on an Enterprise Value basis.

Out of the 21 analysts that have coverage on Birla Corporation, 18 of them have a "buy" rating on the stock, while three have a "hold" rating.

Shares of Birla Corporation are locked in a 20% upper circuit at ₹1,268.8. With this move, the stock has reversed all the losses it had made so far in 2025 and is now trading with gains on a year-to-date basis. The stock is still down 24% from its 52-week high.Continue ReadingCheck out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!TagsBirla CorpBirla Corporationshare market today