Prabhudas Lilladher is bullish on ACC has recommended buy rating on the stock with a target price of Rs 1710 in its research report dated February 05, 2019.
Prabhudas Lilladher's research report on ACC
ACC reported Q4CY18 earnings tad below our estimates due to lower realisations. However, ACC maintained its steady performance on volume growth and cost control. Strong demand in its key home markets like Central UP, Jharkhand, Odisha and West Bengal helped company to post 8% volume growth above our estimate of 7%. Led by quantum improvement in energy efficiency, measured increase in freight cost through route optimisation and strict control on fixed overheads and discretionary spends helped company to contain the cost with a nominal increase of 1.2% YoY (PLe:+1%).
Given the attractive valuations and improved quality of operations, we maintain BUY with TP of Rs1,710, EV/EBITDA of 13x CY20e.
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