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Cera is a leading sanitary company with a strong brand loyalty and excellent distribution system which enables the company to sell 80%+ of its products in the replacement market. The company has also forayed into faucets and tiles where it has low market share but adequate headroom for growth. These divisions are driving growth and synergies are clearly being realized. Increased spending on home improvement due to urbanization is a key driver for demand. We have an over weight rating on the stock due to reasonable valuations and strong near term performance. Revival in real estate market augurs well for the company and management guidance of 15% for next 2-3 years provides confidence. Cera is amongst the few consumer oriented companies which has managed inflationary pressures well

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