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Dolat Capital Report
Ambuja Cements Ltd.'s reported results beat on estimates, however realisation and Ebitda/tonne inline.
Ambuja Cements posted +18.3% YoY revenue to Rs 47.3 billion (+11.1% QoQ) led by +23.1% YoY/ +12.3% QoQ in volume to 9.1 million tonne, which was partially offset by -3.9% YoY/ -1.1% QoQ in realisation to Rs 5,197.
Ebitda +38.2% YoY/ +20.3% QoQ to Rs 9.5 billion. However, adjusted profit after tax declined by 24.5% YoY to Rs 6.4 billion in Q1 FY24.
We increase our Ebitda estimates by 5.6%/ 5% for FY24E/ FY25E factoring higher volume growth and lower Ebitda/tonne.
We expect -3.1%/ +15.3%/ +1.6% revenue/ Ebitda/ adjusted profit after tax compound annual growth rate over FY23- FY25E led by -6.8% (+16.3% like to like)/ +2.7% volume growth and -1.9%/ 0.0% cement realisation growth in FY24E/ FY25E.
Considering 17% stock price run up from last result update and fair valuation, we downgrade from 'Reduce' to 'Sell' with a revised target price of Rs 436.
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