Ambuja Cements Q4 Results Review - Weak Numbers: IDBI Capital

IDBI Capital Report

Ambuja Cements Ltd. Q4 FY24 Ebitda came lower than estimate by 13%. This is led by decrease in cement prices. Ambuja Cement is expected to increase its capacity by 27% / 11% in FY25E and FY26E and currently the expansion programme is on track.

The company is also planning to reduce opex and improve Ebitda by various methods. We retain target price and rating (sell) on Ambuja Cement and prefer ACC (as its profitability is improving).

On Ambuja Cement target price retained at Rs 522 we at 15 times FY26 enterprise /Ebitda and its ACC stake is d at 20% discount to current market price.

Overall capex intensity to remain high. For FY24, Capex stood at Rs 70 billion, for FY25 expecting capex of Rs 50-60 billion. The capacity expansion plan for 140 mtpa, will be funded by internal accruals and operating cashflows, the targets are set to reach 100 mtpa by FY25, 120 mtpa by FY26 and 140 mtpa by FY28.

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