Ambuja Cements Ltd. share price target

Cement demand to continue to remain robust After witnessing modest demand decline of ~2.0% in FY21 cement demand is expected to witness a strong upcycle in FY22E led by urban housing recovery and infra push by the government. While demand in H1FY21 was largely driven by strong rural housing demand, urban housing and infra segment aided recovery in H2FY21. Going forward, higher budgetary allocation by the government on infrastructure (up 26% YoY | 5.54 lakh crore), lower interest rates and recovery in private capex would continue to...

Ambuja Cement (ACEM) Q4CY20 EBITDA was 8% higher than our estimate. Beat is driven by the volume growth of 7% YoY. Post the result, we have increased volume growth expectations for ACEM (exhibit 10). This has increased EBITDA estimate by 2%/6% for CY21/22E. We have increased EV/EBITDA valuation to value ACEM to 12x (11x earlier) and led by special dividend in CY20, net cash has reduced in SOTP based valuation. TP is revised up to Rs269 (earlier Rs245). ACEM plans to increase its cement capacity by 6% and clinker capacity by 17% in CY21. And has extended MSA program with ACC for period of 3 years and is targeting reducing the cost by Rs200/t. Stock at...

Renewed Master Supply Agreement (MSA) with ACC for the next 3 years. Ambuja Cement (ACEM) delivered strong set of Q4CY20 earnings with 9%/5% beat on our/consensus EBITDA estimates. The beat was driven by better than expected realisations and lower costs....

Street is doubtful on sector's ability to increase prices post CCI raids. While, we remain confident that prices would see meaningful increase to help maintain Q3FY21 margins given the peak period of activity and steep surge in fuel cost. We...

We remain cautious on cement industry, given ongoing weakness in Infrastructure projects, construction, road and other housing activities and expect slow recovery. Hence, we maintain our HOLD rating on the...

Ambuja Cement has reported good set of numbers during Q3CY20 with strong volume growth and margin beat. Company has posted a volume growth of 8% YoY//35% QoQ in 3QCY20, owing to pent-up demand and strong recovery in rural market. Revenue for the quarter grew by 9% YoY/31% QoQ, driven by strong volume growth and better pricing. EBITDA during the quarter grew by 55% YoY/14% QoQ to Rs 680 cr, largely due to tight control over fixed cost. EBITDA margin improved sharply to 23.9% during the quarter from 16.8% in Q3CY19. Profit for the...

Ambuja Cement (ACEM) delivered strong set of Q3CY20 earnings with 17%/14% beat on our/consensus EBITDA estimates. The beat was primarily driven by steeper than expected reduction in costs. Factoring in lower costs...