Synopsis:
Jefferies, HSBC, and UBS have all given “Buy” ratings on Ambuja Cements Limited, with target prices of ₹770, ₹700, and ₹710, indicating 35.73%, 23.39%, and 25.15% upside potential, respectively.
This Adani Group Stock, engaged in the business of manufacturing, marketing, and selling cement and clinker through integrated cement plants and grinding units across India, is in focus after Jefferies, HSBC, and UBS gave a target, which has an upside potential of up to 35.73 percent.
With a market capitalization of Rs. 1,40,226.55 crores, the share of Ambuja Cements Limited has closed at Rs. 567.30 per equity share, down nearly 1.74 percent from its previous day’s close price of Rs. 577.35.
What is the news?
Jefferies, a prominent brokerage firm, has recommended a “Buy” call on Ambuja Cements Limited with a target price increase from Rs. 755 to Rs. 770 per share, indicating an upside potential of 35.73 percent.
Jefferies gave a positive view on Ambuja Cements Limited, noting a strong performance with higher sales volumes and improved profits for the third quarter in a row. The company continues to show steady growth, supported by strong demand and clear plans to cut costs further. However, its cash balance fell slightly as working capital needs rose.
Additionally, HSBC, a prominent brokerage firm, has recommended a “Buy” call on Ambuja Cements Limited with a target price of Rs. 700 per share, indicating an upside potential of 23.39 percent.
HSBC maintained a positive outlook on Ambuja Cements Limited, highlighting that a strong second-quarter performance was helped by tax benefits and lower costs. The brokerage expects further savings in the second half of the year, which should support profitability. It also noted that Ambuja’s ongoing capacity expansion plans are a key strength and will drive long-term growth for the company.
Further, UBS, a prominent brokerage firm, has recommended a “Buy” call on Ambuja Cements Limited with a target price of Rs. 710 per share, indicating an upside potential of 25.15 percent.
UBS gave a positive outlook on Ambuja Cements Limited after a strong second-quarter performance. The company increased its capacity target to 155 million tonnes by FY28. The better-than-expected results were mainly driven by ACC and Orient, while Ambuja’s standalone performance met expectations. UBS expects steady earnings growth and major cost savings over the next two years, supporting the company’s expansion and profitability goals.
Operational Highlights
Ambuja Cements has increased its FY28 capacity goal to 155 million tonnes, up from 140 million tonnes earlier. This extra 15 MTPA capacity will come from debottlenecking projects at a lower cost of USD 48 per tonne. Over the next year, the company plans to install 13 blenders across plants to improve its product mix, boost premium cement sales, and raise overall realisations.
Operationally, Ambuja has started trial runs at its new 4 MTPA kiln line in Bhatapara, Chhattisgarh, and made its 2 MTPA grinding unit at Krishnapatnam operational. Another 7 MTPA of capacity is set to start in the third quarter across three more sites.
On the renewable energy side, Ambuja added 200 MW of solar power this quarter, bringing total renewable capacity to 673 MW. It aims to reach 900 MW by FY26 and 1,122 MW by FY27.
Company Overview
Ambuja Cements Limited was incorporated in 1981 and started cement production in 1986. Originally named Gujarat Ambuja Cements Limited, it was established as a joint venture between the Gujarat Industrial Investment Corporation and Narottam Sekhsaria and associates. The company is now a part of the Adani Group and is headquartered in Mumbai, India.
The company is engaged in the manufacturing, marketing, and sale of cement and clinker. It operates several integrated cement plants and grinding units across India, including locations in Gujarat, Rajasthan, Himachal Pradesh, Uttar Pradesh, and Maharashtra.
Ambuja Cements is recognized for adopting advanced technologies for efficient cement production, including biomass co-fired power plants for greener energy. Its product portfolio includes ordinary Portland cement, Portland slag cement, composite cement, and specialty cement products tailored to diverse customer needs.
Recent quarter results
Coming into financial highlights, Ambuja Cements Limited’s revenue has increased from Rs. 7,552 crore in Q2 FY25 to Rs. 9,174 crore in Q2 FY26, which has grown by 21.48 percent. The net profit has also grown by 364.11 percent from Rs. 496 crore in Q2 FY25 to Rs. 2,302 crore in Q2 FY26.
In terms of return ratios, the company’s ROCE and ROE stand at 10.5 percent and 8.73 percent, respectively. Ambuja Cements Limited has an earnings per share (EPS) of Rs. 23, and its debt-to-equity ratio is 0.02x.
Written By – Nikhil Naik
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.
