Prabhudas Lilladher has given Buy recommendation for ACC with a target price of Rs. 2300 in its research report issued on Apr 19, 2022

Prabhudas Lilladher’s research report on ACC

ACC reported Q1CY22 earnings in line with our and consensus estimates (CE). EBITDA declined 26% YoY at Rs6.35bn (PLe:Rs6.30bn, CE:Rs6.47bn) due to 3%/24% fall in volumes/margins. ACC narrowed the gap on margins with peers over last couple of years on back of visible reduction in manufacturing costs and higher operational efficiencies under program ‘Parvat’, complemented by rationalisation of logistics costs through Master supply agreement (MSA) with Ambuja cement. However, the scope for further reduction in costs remain limited as majority of levers are already captured in current cost dynamics, except reduction in power costs on account of upcoming WHR plants. In spite of slow pace of price hikes and sharp increase in costs, we continue to like ACC on back of attractive valuations and upcoming capacity addition of 5mnt in one of its most profitable and growing region, Central region.

Outlook

Maintain BUY with TP of Rs2,300 based on EV/EBITDA of 12x CY23e.

More Info

At 17:30 ACC was quoting at Rs 2,057.90, down Rs 95.65, or 4.44 percent.

It has touched an intraday high of Rs 2,184.95 and an intraday low of Rs 2,028.25.

It was trading with volumes of 25,995 shares, compared to its thirty day average of 18,172 shares, an increase of 43.05 percent.

In the previous trading session, the share closed down 2.43 percent or Rs 53.60 at Rs 2,153.55.

The share touched its 52-week high Rs 2,587.95 and 52-week low Rs 1,784.15 on 15 November, 2021 and 22 April, 2021, respectively.

Currently, it is trading 20.48 percent below its 52-week high and 15.34 percent above its 52-week low.

Market capitalisation stands at Rs 38,644.74 crore.

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