Indian cement firm ACC tops Q4 profit view on strong sales volumes
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Indian cement producer ACC topped fourth-quarter profit estimates on Thursday, as lower prices helped boost sales volumes.
The Adani Group-owned company's profit after tax rose over three-fold to 7.49 billion rupees ($89.9 million) in the January-March period, surpassing analysts' average estimate of 4.86 billion rupees, according to LSEG data.
Revenue from operations rose nearly 13% to 53.98 billion rupees, helped by a 22.4% rise in consolidated sales volumes. Analysts were expecting a 14%-15% volume growth.
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KEY CONTEXT
Indian cement makers have benefitted from strong infrastructure and real estate demand for the past few quarters.
However, the January-March quarter is a seasonally strong period, when cement makers resort to steeper-than-normal discounts to boost volumes and meet fiscal year-end targets amid tough competition. Cement prices fell roughly 5% sequentially to a two-year low in the reported quarter.
Peer Dalmia Bharat reported a smaller-than-expected fall in profit on Wednesday, aided by strong volume growth.
PEER COMPARISON
Valuation (next Estimates (next 12 Analysts' sentiment
12 months) months)
RIC PE EV/EBITD Revenue Profit Mean # of Stock to price Div
A growth (%) growth rating analysts target- ** yield
(%) * (%)
ACC Ltd 20.49 11.18 7.68 18.53 Buy 15 0.88 0.38
Ambuja Cements 32.54 18.36 4.75 15.26 Hold 20 1.07 0.41
UltraTech Cement 29.25 17.08 11.60 32.00 Buy 34 0.90 0.40
Shree Cement 32.93 16.31 9.76 16.34 Hold 16 0.87 0.43
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above the PT
JANUARY-MARCH STOCK PERFORMANCE
-- All data from LSEG -- $1 = 83.3425 Indian rupees
