Moneycontrol
Jan 10, 2018 12:13 PM IST | Source: Moneycontrol.com

Hold Ambuja Cements, downgrade ACC; cement cos to report strong sales volumes: HSBC

The firm believes that the cement companies are likely to report strong sales volumes coupled with benign base in the previous quarter. Meanwhile, the industry cost pressures negatively impacting profitability.

 
 
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The global brokerage house HSBC has downgraded ACC to hold from buy and cut price target to Rs 1,875 from Rs 1,900.

However, the firm has maintained hold rating on Ambuja Cements with increase in target price to Rs 260 from Rs 252.

The firm believes that the cement companies are likely to report strong sales volumes coupled with benign base in the previous quarter. Meanwhile, the industry cost pressures negatively impacting profitability.

The muted demand continues to hit the South region as it is the only region to face YoY decline, it added.

The firm has cut CY17-19e EBITDA estimates by 13-24 percent for ACC, Ambuja on rising cost pressure.

It expect momentum to continue in Q4 on sharp surge in volume.

At 12:06 hrs ACC was quoting at Rs 1,806.80, down 0.34 percent and Ambuja Cements was quoting at Rs 274, down 1.03 percent on the BSE.

Posted by Rakesh Patil
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