ACC Ltd. share price target

We change our rating from HOLD to BUY on the recent correction in stock price.

We maintain our HOLD recommendation on the stock

Q1FY25 revenue stayed flat YoY as 8.5% uptick in volume was offset by realisation drop of 8.3%

We downgrade our recommendation on the stock from BUY to HOLD.

In current times of cement price weakness (hikes attempted in Apr’24 have not only reversed but prices have slipped further in May’24)

Q4 revenue growth of 13% YoY boosted by 22% uptick in volumes (unadjusted to MSA) while realisations moderated ~7%

We roll over our estimate to FY26 and maintain our BUY recommendation on the stock.

Our earnings forecast for ACC appears largely immune to the current weakness (and uncertain outlook) on cement prices.

ACC’s Q4FY24 EBITDA grew 79% YoY (down 8% QoQ) to Rs8.4bn, which was
~4% higher than our estimate. On a sequential basis, EBITDA/t declined by
Rs215 to Rs802 (Emkay: Rs820), mainly on account of weak blended
realizations that fell by Rs341/t in Q4FY24.

ACC’s 4QFY24 EBITDA grew ~80% YoY to INR8.4b (+3% vs. our estimate). Its
EBITDA/t grew 45% YoY to INR802 (-6% vs. estimate), due to lower-thanestimated realization. Realization was down ~9%/7% YoY/QoQ to INR5,171
(-4% vs. estimate). OPM was up 5.8pp YoY to 15.5% (est. ~16%). Adj. PAT
stood at INR4.9b (+72% YoY; 4% above our estimates).