Q3CY19 result highlights
Impact on financials: No change to consolidated CY19/20E EPS of Rs10/11.7
Valuations & view
Ambuja delivered a decent quarter wherein the higher exposure to West protected realisation drop. However, cost did not see a declining trend and now would be a key monitorable area. Overall, we believe volume growth trajectory will see a gradual improvement as govt spending on infra and low cost housing sees an uptick. Over the long term, commissioning of 3.1mtpa Marwa-Mundwa project to be operational by 2HCY20 will drive growth. Accordingly, we expect 26% consolidated earnings CAGR over CY18-20E. We believe consolidated valuations are attractive at 8.6x CY19E EV/EBITDA and US$102 on EV/t. Maintain Outperformer.
Ambuja Cement is a holding company. Co. is engaged in the manufacture and bulk export of cement and clinker products. Through its subsidiaries, Co. is engaged in investment holding in cement industries; finance services; the manufacture of cement; and property development and construction projects.
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