Ambuja Cements Can Zoom Upto 38% On Scale And Synergy Play, Says Motilal Oswal Maintaining 'Buy'

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Motilal Oswal Report

Though near-term challenges (delay in cement demand pickup and weak non-trade prices) weigh on Ambuja Cements Ltd.'s stock performance, we maintain our constructive view on the company given its rising scale of operation, balanced capacity mix, and profitability improvement.

The stock is trading attractively at 15x/13x FY27E/FY28E EV/Ebitda (vs last five-year average one-year forward EV/Ebitda of 18x) and $128/$119 EV/tonne (last 5-year average one-year forward EV/t of $170).

We value Ambuja Cements at 20x Sep’27E EV/Ebitda to arrive at our target price of Rs 750.

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