Q4CY18 result highlights
Impact on financials: Standalone no change, Cons. CY19 EPS +6% to Rs10.4
Valuations & view:
Ambuja’s focus is on growth and expansion strategy to support strong demand growth across regions. Accordingly, it announced additional 1.4mtpa clinker capacity, 1.8mtpa grinding capacity and also the captive power plants and WHRS plants at the Marwa-Mundwa project (initially 1.7mtpa capacity; operational by 2HCY20; total 3.1mtpa), which should drive long term growth. Accordingly, earnings are likely to grow at 17.7% CAGR over CY18-20E. We believe consolidated valuations are attractive at 9.4x CY19E EV/EBITDA and US$98 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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