Below are the price targets for HeidelbergCement India Limited over the next 10 years.
Our price targets for HeidelbergCement India Limited for the remainder of 2020 are:
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264.88 (overvalued)
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184.80 (fair value)
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104.72 (undervalued)
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67.76 (extreme undervalue)
The valuation targets for HeidelbergCement India Limited are based on a dividend growth rate of 15% which is derived from slightly less than one half the average dividend growth from 2017 to 2020 and applied to Edson Gould’s Altimeter. A graphical representation of the overvalued, fair value, and undervalued levels are below.
The above Altimeter translates into the following undervalued and overvalued ranges since 2000:
10-Year Targets
Observations
The dividend growth rate has averaged 30.95% since 2017. However this is unsustainable in our view and is likely to decrease over time. Using a highly conservative dividend growth rate of 15% in the data above assumes that the growth rate will decline over time.
Individuals willing to assume extreme levels of risk, and therefore a minimum of loss of -50%, using the average increase of dividends from 2017 suggests that HeidelbergCement India Limited is undervalued, as demonstrated in the chart below.
it would be unwise to make the assumption that an average dividend increase of 30% can continue. Use the data and charts as a guideline in case of material changes occur.
see also: