Ambuja Cements, owned by the Adani Group, posted a remarkable 242% jump in standalone net profit to Rs 1,758 crore for the December quarter of FY25, compared to Rs 514 crore in the same period last year. Despite strong volume growth of 17% year-on-year, the stock tumbled in trade on January 30, reflecting investor concerns over weak margins.
The EBITDA, excluding tax reversals, for the firm lowered 50% to Rs 890 crore, impacted by poor realizations and a rise in operational expenses. EBITDA per unit plunged 56% at Rs 537, below Motilal Oswal estimates at Rs 848 per unit.
The stocks of Ambuja Cements moved at Rs 505.4 at 1:52 pm, down 3.2%.
The management credited recently developed capabilities of Penna and Sanghi Cement for volumes driving but at a price of mounting expenses and lowered realizations through underpenetration and southern market vulnerability.
Broking firms were divided in their view about the stock. JM Financial continued with a ‘Buy’ rating, citing strong position in the market and healthy financials of Ambuja, but stressed that improvement in profitability will drive stocks’ performance. Nuvama Institutional Equities upgraded its rating for the stock to ‘Buy’ with a target price of Rs 676, citing fall in stocks at present and high growth potentiality as important factors.
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Source: Moneycontrol
News Desk
