Synopsis:
Ambuja Cements Limited is in the focus after CLSA has assigned new target prices, highlighting future performance.
Ambani group’s stock is in the spotlight during today’s trade after analysts have assigned fresh target prices for the stock, drawing investor interest and adding momentum to the stock.
With the market capitalization of Rs. 1,39,696.05 crore, the shares of Ambuja Cements Ltd were trading at Rs. 567.15, down by 0.55 percent from its previous day’s close price of Rs. 570.30 per equity share.
What’s the news?
CLSA has maintained its ‘Outperform’ rating on the stock with the target price of Rs. 665, with an upside of 17.25 percent from CMP of Rs. 567.15. CLSA maintains an “Outperform” rating on Ambuja Cements, citing improving demand and profitability.
The company expects positive impact from GST reduction and premiumisation, though near-term demand is affected by monsoons and deferred purchases. Over the medium term, Ambuja anticipates industry growth of 7–8 percent, and it will grow in double digits and aims for a 20 percent market share with profitability of Rs. 1,500 per tonne.
Also Read: Ashish Kacholia backed stock in focus after promoter offloads 2 Lakh shares in the company
About the Company
Ambuja Cements Limited is an Indian cement manufacturer producing a wide range of cement products such as Ambuja Cement, Ambuja Kawach, Ambuja Plus, and more. It also offers support services for homebuilders, contractors, architects, and engineers.
Its subsidiaries include M.G.T Cements, Chemical Limes Mundwa, Dirk India, Bulk Cement Corporation, ACC Mineral Resources, Lucky Minmat, Singhania Minerals, and OneIndia BSC.
Together with its subsidiary ACC Ltd., it has a cement capacity of 104.5 MTPA, operating 24 integrated plants, 22 grinding units, 114 ready-mix concrete plants, 10 bulk cement terminals, and 11 captive ships.
The company maintains a clinker factor of 65.8 percent, a thermal substitution rate of 6.4 percent, and produces 80 percent blended cement. It also has a vast distribution network with over 1,15,000 channel partners across India.
Financial Outlook
In Q1FY26, the company reported revenue of Rs. 10,289 crore, marking a strong 22.6 percent YoY growth from Rs. 8,392 crore in Q1FY25 and a 3.1 percent increase QoQ from Rs. 9,981 crore in Q4FY25. Operating profit rose significantly to Rs. 1,961 crore, up 53.2 percent YoY from Rs. 1,280 crore and 5.0 percent QoQ from Rs. 1,868 crore, reflecting improved operational efficiency.
Net profit for the quarter reached Rs. 970 crore, growing 23.9 percent YoY from Rs. 783 crore in Q1FY25, though it declined 24.3 percent QoQ from Rs. 1,282 crore in Q4FY25, similarly EPS was also increased to Rs. 3.20 from Rs. 2.60 in Q1FY25.
At the moment, the company’s P/E ratio is 32.3x lower as compared to its industry P/E 47.9x, and its ROE and ROCE are 8.73 percent and 10.5 percent, respectively, showing companies financial performance, whereas the D/E ratio of the company stands at 0.01.
Written by Akshay Sanghavi
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
