[Neutral ACC; target of Rs 2600: Motilal Oswal

Motilal Oswal's research report on ACC

ACC’s 4QFY24 EBITDA grew ~80% YoY to INR8.4b (+3% vs. our estimate). ItsEBITDA/t grew 45% YoY to INR802 (-6% vs. estimate), due to lower-than- estimated realization. Realization was down ~9%/7% YoY/QoQ to INR5,171(-4% vs. estimate). OPM was up 5.8pp YoY to 15.5% (est. ~16%). Adj. PATstood at INR4.9b (+72% YoY; 4% above our estimates).The management remains positive on industry outlook as higher budgetaryallocation to infrastructure, government’s push for affordable housing, andpick up in construction activities are expected to drive cement demand. Ittargets to increase green energy share to 60% by FY28 from ~9% in FY24.

Outlook

We largely maintained our EBITDA estimates for FY25/FY26. ACC trades at11.5x/10x FY25E/FY26E. We value ACC at 10x FY26E EV/EBITDA to arrive atour TP of INR2,600. We reiterate our Neutral rating on the stock.