Gains in ACC share price as Q1 earnings surpass expectations; Brokerages increase projections

Cement manufacturer ACC Ltd, a member of the Adani group, reported a net profit of $466.14 billion for the quarter that ended in June 2023, increasing 105% from the $227.35 billion it earned during the same time the previous year. Following the release of strong Q1 statistics, in which net profit more than doubled during the quarter, the ACC share price increased by more than 1% on Friday. On the BSE, ACC shares increased by as much as 1.72% to 1,972.00 per share.

Cement volume at ACC increased by 23% YoY, exceeding both consensus predictions of 10% growth and UBS estimates by a substantial margin. Realisation per ton decreased 2% QoQ, comparable to peers, however EBITDA exceeded expectations by 22%. Results for the first quarter of the year exceeded Motilal Oswal Financial Services' predictions on all counts. According to MOFS, ACC trades at valuations of 11.0x/8.2x FY24E/FY25E EV/EBITDA and $100/$95 FY24E/FY25E EV/ton, which are both reasonable. It kept the stock's 'Neutral' rating while increasing the target price from 2,000 to 2,180 per share.

ACC share price stands at ₹1,932.25 apiece on the BSE presently (11:43 am, 28/07/23).

- Adarsh Agarwal