Nalanda Securities hold rating on ACC with a target price of Rs 1742 in its research report dated April 24, 2019.
Nalanda Securities' research report on ACC
The volumes in Q1CY19 stood at 7.5 mn tons registering a growth of 5.6% y-o-y. Although the industry has been plagued with rising input costs, the company has managed to curb this inflationary environment by optimizing its expenses. Post commissioning of its plants in the Jamul and Sindri, the company has benefited with the Eastern region and further plans to expand capacities. Reported EBITDA of INR 531.7 crore and blended realization of INR 5133/ton was sharply below street estimates.
We remain positive on the stock and maintain our target price of INR 1742 giving an upside of 5%. (i.e. valuing the stock at CY20E EV/Ton of $110/Ton, 11x CY20E EV/EBITDA). We believe stock should be added on dips as there has been another round of price hikes in April which bodes well for the company.
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