Ambuja Cements Company Report
COMPANY NAME- AMBUJA
CEMENTS LTD.
BSE CODE: 500425 SIZE:
LARGECAP
SECTOR: CONSTRUCTION & REALTY
INDUSTRY: CEMENTS
STOCK PRICE (AS ON 9th JULY 2015) – RS 244.10 (BSE)
TARGET PRICE: RS. 293 POTENTIAL UPSIDE: 20%
Net profit of the Ambuja Cement, jumped 44% to Rs 239.06 crore on
the back of 9% growth in its income from operation to Rs 2202.06 crore for the
quarter ended September 2014, thanks to surge in sales realization.
Operating margin increased by 450 basis points to 17.9%, as a result, operating
profit growth ballooned 46% to Rs 393.41 crore.
The company income from operation increased 9% to Rs 2202.06 crore (including
other operating income of Rs 14.51 crore), due to improvement in sales
realization, despite fall in sales volume. The combined domestic cement and
clinker sales fell 1.1% to 4.67 million tonne but realization surged 10.4% to Rs
4684 per tonne. Operating profit margin (OPM) increased by 450 bps to 17.9% due
to drop in freight & handling expenses, other cost, power & fuel cost
and employee benefit expenses.
As
a % of adjusted sales, there was drop in freight & forwarding cost by 160
bps to 24.4%, other operating cost by 210 bps to 20.4%, power & fuel cost
by 70 bps to 22.7%, and employee benefit cost by 30 bps to 6.3%.As a result,
the operating profit grew sharply 46% to Rs 393.41 crore. The company expects
cement demand likely to be better with expectation of higher GDP growth and
improved business sentiments. The drivers for demand will continue to be
housing and infrastructure considering Government's recent push in this sector.
The Company would continue to work on improving efficiencies and focus on
customer and commercial excellence. The Company believes that these initiatives
will help improve performance.
Technical Analysis:
This
stock is in a firm uptrend and is likely to see much higher levels. The short
term support is placed at 264 and long term support exists at 265. On the
higher side, previous high of 274 remains the important resistance. A close
above this level, Ambuja Cements will witness a sharp rally towards 300.
Contact us Here:
PRAGMATIC WEALTH MANAGEMENT PVT. LTD.
Head
Office:
102,
1st Floor, Topaz Society,
Dr.
Nair Road, Agripada, Mumbai Central (E), Mumbai 400011
Tel: +91-8108178683
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