August 27, 2025/CSL Research
Dangote Cement Plc reported robust top-line growth in the first half of 2025, with Revenue rising 17.7% year-on-year (y/y) to ₦2.07 trillion, driven mainly by strategic price increases despite a 4.1% decline in sales volume. Nigerian operations led this growth with a 45.5% y/y Revenue increase, supported by a 46.2% y/y rise in average selling price, offsetting a slight 0.5% y/y dip in volumes due to weaker consumer purchasing power and reduced real estate activities. Conversely, Pan-African operations faced challenges, including post-election uncertainties and liquidity issues, resulting in a 15.5% y/y Revenue decline.
For FY 2025, Dangote Cement’s revenue growth is expected to be driven primarily by further price increases in Nigeria. The average price per tonne is projected to rise by 30.0% y/y to ₦187,200, offsetting an anticipated 3.0% decline in sales volume to 17.3 million metric tonnes. This pricing strategy aims to protect margins in the face of persistent inflation and weaker consumer demand. Conversely, Pan-African operations are forecast to see a 0.8% decline in volume and a 3.4% reduction in average price. Nevertheless, the strong pricing momentum in Nigeria is expected to more than compensate for these regional pressures, resulting in a 20.6% year-on-year increase in total group Revenue to ₦4.32 trillion.
We have revised our target price upwards to N681.71/s from N525.38/s, previously reflecting our strong FY 2025 expectations. However, we maintain our BUY recommendation on the stock. The stock currently trades at an EV/EBITDA ratio of 6.76x, which is lower than its MEA peers of 10.30x. We arrived at our target price using a blend of DCF and Relative valuation in the ratio of 60:40. Current Price: 520.00/s.
To read full report, click on the link below
CSL Dangote Cement H1 2025 Company Update .pdf
