Ultratech Cement Ltd : Accumulate for target of Rs1595 : GEPL PDF link

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Summary

We maintain our target of Rs 1,595 arrived based both on EV/MT and EV/EBIDTA on a differential weightage. Owing to the sharp fall seen in the recent past there is an upside of 12%, hence we revise our recommendation from NEUTRAL to ACCUMULATE rating on the stock.

The results for the Q4FY12 have been in line with our estimates. Demand for cement is expected to remain good in Q1FY13; however, owing to recent intervention by CCI on cartelisation we don't expect a strong up tick in cement prices in Q1FY13. We believe that RBI's move (50bps cut in repo) might trigger demand from housing and industrial segment in the near term. Also projects like DMIC (Delhi Mumbai industrial corridor) coupled with encouraging data on project implementation under public private partnership should help cement companies in the long run. 

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