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ACC an underperformer: Prabhudas Lilladher
Prabhudas Lilladher has maintained its underperformer rating on ACC. At current market price, the stock trades at P/E of 10.8x and 11.9x CY08E and CY09E respectively, while on EV/EBITDA it trades at 5.9x and 6.8x CY08E and CY09E respectively.
Prabhudas Lilladher has maintained its underperformer rating on ACC in its April 16, 2008 research report. "At current market price, the stock trades at P/E of 10.8x and 11.9x CY08E and CY09E respectively, while on EV/EBITDA it trades at 5.9x and 6.8x CY08E and CY09E respectively. The industry's pricing power is expected to dilute sharply with the commissioning of massive capacity addition lined-up across regions. We expect addition of 84 million tonnes in the next two years on conservative basis, against incremental demand of 60 million tonnes, leading to a huge supply surplus situation. In addition to this, domestic coal prices, which used to be administered prices in the past, are now moving towards market-determined mechanism. We maintain Underperformer rating on the stock," says Lilladher's research report.
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