Visit http://indiaer.blogspot.com/ for complete details Ambuja Cement |
Results below estimates- Maintain HOLD |
HOLD
CMP: Rs 142 Target Price: Rs 130
n Net profit at Rs1.52 bn (-44% yoy) below estimates (Rs2.07 bn), led by higher P&F costs & lower other income. Revenue down 2.9%yoy -Volumes +6.1% yoy, realizations - 8.5%yoy
n EBITDA at Rs 2.8bn (-34.2%yoy) (Estimate–Rs3.4 bn). Sharp jump in P&F costs (Rs1017/t up 29.7% yoy) negates benefits of zero clinker purchases. EBITDA/t at Rs651 (-38%yoy)
n Downgrade our earnings by 2.5% for CY10 and 2.9% for CY11. with recent hikes in cement prices and improving demand outlook, we expect the worst to be over for Ambuja
n Upgrade our price target to Rs130 (valued at EV/ton of USD140 for CY11). However Rich valuation at PER of 15.7 & EV/ton of USD151 leaves little upside. Maintain HOLD
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