ICICI Direct has given Buy recommendation for Ambuja Cements with a target price of Rs. 490 in its research report issued on Jul 26, 2021

ICICI Direct’s research report on Ambuja Cements

Ambuja Cement (a Holcim group company) is a large cement player with capacity of over 29.7 MT spread across North-Central (40%), West (~35%) and East (~25%) India. It has a large marketing set-up, pan-India presence and strong operational linkages with ACC.The upcoming new capacity at Rajasthan will enhance its cement capacity by 1.8 MT to 31.5 MT and clinker capacity by 3.0 MT In the long run, the company plans to reach over ~50 MT capacity through significant de-bottlenecking and setting up of satellite grinding units

Outlook

With new capacities coming on stream from Q3CY21, we expect healthy double digit growth during CY20-22E. Hence, we maintain BUY rating  We value Ambuja at Rs 490 i.e.17x CY22E EV/EBITDA

 

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