ACC rating – Buy- Muted show in Q1CY22 along expected lines
时间:2024-09-29 02:32:51 阅读(143)
Q1CY22 was a muted quarter for ACC (Ebitda plunging 26% y-o-y; though up 14% q-o-q). However, most of this is priced in in our view given Ebitda broadly matched Street’s and our expectation. In the wake of sharp price hikes across regions – to pass on industry-wide impact of surging fuel prices – we see limited risk to earnings.
The recent buzz of a potential stake sale by global parent Holcim Group (HG) should drive outperformance, in our view. The current valuations of $100 EV/t deserve a premium (in case of a sell-off) given ACC is one of the strongest brands and has a pan-India network. With ACC’s efforts to enhance efficiency being in focus, we maintain ‘Buy’.
Outperformance in store: We expect ACC to outperform given: (i) Undemanding valuations of 10.9x CY22e and 8.8x CY23e EV/Ebitda. (ii) In case the parent’s stake is on the block, ACC deserves a premium for its strong brand and pan-India network. We continue to value ACC at 13x EV/Ebitda and maintain ‘BUY/SO’.
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