ICICI Direct has given Buy recommendation for ACC with a target price of Rs. 2800 in its research report issued on Oct 20, 2021

ICICI Direct’s research report on ACC

ACC (a Holcim group company) is a large cement player with capacity of over 34.5 MT in India and one of the oldest cement player in the industry. The company also manufactures ready-mix concrete and has 50 plants across India. ACC has a strong balance-sheet with debt free status. However, it remains a laggard in terms of efficiency and operating margins vs. peer companies The ongoing capex of Rs 3500 crore would increase its capacity to 39.3 MT by H1CY22E. A 1.1 MT GU in Sindri has already been commissioned. Balance 4.8 MT new capacities are progressing according to schedule

Outlook

Given the healthy growth outlook and comfortable valuations, we remain positive and retain our BUY rating on the stock We value ACC at Rs 2800 i.e.12.5x CY22E EV/EBITDA

 

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