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http://content.icicidirect.com/mailimages/ICICIdirect_AmbujaCement_Q1CY12.pdf
M a r g i n i m p r o v e s s e q u e n t ia l l y o n c o s t s a v i n g s …
Ambuja Cement reported its Q1CY12 results, which were in line with our
estimates on the revenue front as net sales surged 19.3% YoY to | 2633
crore (I-direct estimate: ~| 2781 crore). The EBITDA increased ~22%
YoY to | 744.5 crore (I-direct estimate: ~| 693.5 core) mainly due to
growth in cement sales volumes by 7.5% YoY to ~6.1 million tonnes
(MT) and realisation by 11% YoY to ~4327/tonne respectively. Total cost
increased by 10.1% YoY to | 3104/tonne, mainly due to P&F and raw
material cost, which rose 21% YoY and 19% YoY to
| 1030/tonne and | 305/tonne, respectively. However, it reported PAT of
| 312 crore mainly hit by exceptional item of | 279 crore raised due to a
change in the depreciation policy. We expect volume growth of ~6%
CAGR over CY11-13E to 23.4 MT. We assume realisation growth of
~5-6% YoY each in CY12E and CY13E.
ƒ Cement volume up ~7.5% YoY, realisation up ~11% YoY
Sales volumes increased ~7.5% YoY (~16% QoQ) to ~6.1 MTPA in
Q1CY12 on account of a seasonal pick-up in demand from
construction activities. Realisation improved ~11% YoY to
| 4327/tonne due to a rise in cement prices during the quarter but
declined by ~2% on a QoQ basis.
ƒ EBITDA/tonne up ~13% YoY (~53% QoQ)
EBITDA/tonne increased ~13% YoY to | 1223/tonne supported by a
rise in realisation. Sequentially, the EBITDA/tonne surged ~53%
YoY backed by ~14% dip in total cost/tonne.
V a l u a t i o n
At the CMP of | 165, the stock is trading at 17x and 16x its CY12E and
CY13E earnings, respectively. The stock is trading at an EV/EBITDA of
9.4x and 7.9x of CY12E and CY13E EBITDA, respectively. On an EV/tonne
basis, the stock is trading at $161 and $152 its CY12E and CY13E
capacities, respectively. We are maintaining our target price of
| 162 on the stock with a HOLD rating. We have arrived at the target price
on the basis of valuation of $150/tonne at CY13E capacity of 27 MTPA.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
http://content.icicidirect.com/mailimages/ICICIdirect_AmbujaCement_Q1CY12.pdf
M a r g i n i m p r o v e s s e q u e n t ia l l y o n c o s t s a v i n g s …
Ambuja Cement reported its Q1CY12 results, which were in line with our
estimates on the revenue front as net sales surged 19.3% YoY to | 2633
crore (I-direct estimate: ~| 2781 crore). The EBITDA increased ~22%
YoY to | 744.5 crore (I-direct estimate: ~| 693.5 core) mainly due to
growth in cement sales volumes by 7.5% YoY to ~6.1 million tonnes
(MT) and realisation by 11% YoY to ~4327/tonne respectively. Total cost
increased by 10.1% YoY to | 3104/tonne, mainly due to P&F and raw
material cost, which rose 21% YoY and 19% YoY to
| 1030/tonne and | 305/tonne, respectively. However, it reported PAT of
| 312 crore mainly hit by exceptional item of | 279 crore raised due to a
change in the depreciation policy. We expect volume growth of ~6%
CAGR over CY11-13E to 23.4 MT. We assume realisation growth of
~5-6% YoY each in CY12E and CY13E.
ƒ Cement volume up ~7.5% YoY, realisation up ~11% YoY
Sales volumes increased ~7.5% YoY (~16% QoQ) to ~6.1 MTPA in
Q1CY12 on account of a seasonal pick-up in demand from
construction activities. Realisation improved ~11% YoY to
| 4327/tonne due to a rise in cement prices during the quarter but
declined by ~2% on a QoQ basis.
ƒ EBITDA/tonne up ~13% YoY (~53% QoQ)
EBITDA/tonne increased ~13% YoY to | 1223/tonne supported by a
rise in realisation. Sequentially, the EBITDA/tonne surged ~53%
YoY backed by ~14% dip in total cost/tonne.
V a l u a t i o n
At the CMP of | 165, the stock is trading at 17x and 16x its CY12E and
CY13E earnings, respectively. The stock is trading at an EV/EBITDA of
9.4x and 7.9x of CY12E and CY13E EBITDA, respectively. On an EV/tonne
basis, the stock is trading at $161 and $152 its CY12E and CY13E
capacities, respectively. We are maintaining our target price of
| 162 on the stock with a HOLD rating. We have arrived at the target price
on the basis of valuation of $150/tonne at CY13E capacity of 27 MTPA.
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