KR Choksey has come out with a report on Ambuja Cements' Q3CY09 earnings. The research firm recommended a hold rating on the stock with a target price of Rs 95 on its CY10E, which represents a potential upside of 7.6%.

"Ambuja Cements has major presence in northern, eastern and central region where the demand for cement has been on a rise and prices are firm compared to other regions. The northern region contributes nearly 40% to revenues whereas eastern region contributes nearly 35% to revenues. Ambuja has geographic advantage which would help going forward but realizations would be impacted as the cement industry is facing overcapacity. We recommend a Hold on the stock with a target price of Rs. 95 on its CY10E, which represents a potential upside of 7.6%. At the CMP of Rs 89, the company’s stock is trading at 6.5x on its EV/EBIDTA and 12.3x P/E on its CY10E", says KR Choksey.

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