ACC Jumps 5% as Brokerages Give Thumbs Up to June Quarter Results
ACC shares were trading at Rs 1,592.65, up 1.6%, on BSE at 11:28 am after hitting an intra-day high of 1647.55.
Shares of Cement maker ACC Ltd jumped over 5% in intraday trade on Friday, i.e. 19 July, after the company’s June quarter results beat market expectations. Most brokerage houses maintained their bullish stance on the stock after the results and expected more upside in the stock going ahead.
ACC shares were trading at Rs 1,592.65, up 1.6%, on BSE at 11:28 am after hitting an intra-day high of 1647.55. The stock has jumped over 23% in the last one year and has been one of the best performing large cap stocks during the period.
ACC posted 39% year-on-year growth in June quarter profit at Rs 456 crore and 7.8% growth in revenue from operations at Rs 4,152 crore.
At operating level, earnings before interest, tax, depreciation and amortisation (Ebitda) increased 25% to Rs 784 crore, while margins expanded 264 basis points to 18.89% in the June quarter.
CLSA maintained ‘buy’ call on the ACC stock after the results and increased price target to Rs 2,050 from Rs 2,000 earlier after Ebitda expanded to an eight-year high in the June quarter.
The global brokerage house raised its earnings per share (EPS) forecast by 3-4%. “Cement pricing, a key stock price driver, needs to be monitored,” it said.
Citi also maintained its ‘buy’ call on ACC with a target price of Rs 2,175 per share. It said second quarter earnings beat expectations with Ebitda per tonne hitting a seven-year high, though volumes and pricing gains were partly offset by higher costs.
Japanese brokerage firm Nomura retained its ‘neutral’ rating on the ACC stock with a target price of Rs 1,750 as it feels more price cuts/discounts can be expected in future with demand being weak.
“Realisations will decline over the next 4-5 months, though June quarter results were significantly ahead of consensus,” it said, adding, “We continue to believe cement sector is in an upcycle.”
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