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Motilal Oswal Report
ACC Ltd.'s Q4 FY24 Ebitda grew ~80% YoY to Rs 8.4 billion (+3% versus our estimate). Its Ebitda/tonne grew 45% YoY to Rs 802 (-6% versus estimate), due to lower-than estimated realisation.
Realisation was down ~9%/7% YoY/QoQ to Rs 5,171 (-4% versus estimate).
Operating profit margin was up 5.8% YoY to 15.5% (estimate ~16%). Adjusted profit after tax stood at Rs 4.9 billion (+72% YoY; 4% above our estimates).
The management remains positive on industry outlook as higher budgetary allocation to infrastructure, government's push for affordable housing, and pick up in construction activities are expected to drive cement demand. It targets to increase green energy share to 60% by FY28 from ~9% in FY24.
We largely maintained our Ebitda estimates for FY25/FY26. ACC trades at 11.5 times/10 times FY25E/FY26E. We value ACC at 10 times FY26E enterprise value/Ebitda to arrive at our target price of Rs 2,600. We reiterate our Neutral rating on the stock.
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