HDFC Securities has maintained 'Sell' on India Cements with target price of Rs 85 as against current market price (CMP) of Rs 108 in its report.

Commenting on the same, the broking firm said, "India Cements (ICEM) numbers disappointed, with an EBITDA/t of Rs 448/t (vs. estimated Rs 530/t). Realizations improved 6% QoQ (Rs 4,244/t, +1.3% YoY) driven by late quarter spikes in South. However, volumes declined for the 4thconsecutive quarter (2.56 mT, -3.4% YoY) as overall South demand continues to remain frail. The company reported some sequential improvement in P&F costs/t (Rs 1,190/t, -8.4% QoQ). Trinetra, to be amalgamated into ICEM shortly, reported a strong quarter with EBITDA/t of Rs 830, driven by 14% volumes growth and a sequential realization jump of 8%.The stock trades at USD 65/t and 6.8/5.7x FY15/FY16E EV/EBITDA. We have a cautious view given high debt and inefficient operations.

Q2 will also see volumes decline, with volumes of 0.75mt in July and similar expectations for next two months. The high prices in entire South should translate into substantial EBITDA improvement in Q2. Further, Trinetra continues to do well and ICEM indicated scope for another line there."

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