Hold ACC, target price Rs 2225: Emkay Global

Emkay Global has hold call on ACC with a target price of Rs 2225. The current market price of ACC Ltd. is Rs 2175.5.
Time period given by analyst is one year when ACC Ltd. price can reach defined target.

ACC Ltd., incorporated in the year 1936, is a Large Cap company (having a market cap of Rs 40767.68 Crore) operating in Cement sector.


ACC Ltd. key Products/Revenue Segments include Cement, Ready Mix Concrete, Other Operating Revenue, Scrap for the year ending 31-Dec-2021.


Financials
For the quarter ended 30-06-2022, the company reported a Consolidated Total Income of Rs 4522.28 Crore, up .83 % from last quarter Total Income of Rs 4485.01 Crore and up 15.06 % from last year same quarter Total Income of Rs 3930.49 Crore. Company reported net profit after tax of Rs 223.00 Crore in latest quarter.

Investment Rationale
The brokerage factors in higher opex/ton, we cut our EBITDA estimates for CY22 by 12% and CY23-24 by 3%, and revises TP to Rs2,225 (earlier Rs2,300). THe DCF-based TP implies a 1-year forward EV/EBITDA of 10x. An open offer from Adani at Rs2,300 per share may act as a cushion for the stock.

Promoter/FII Holdings
Promoters held 54.53 per cent stake in the company as of 30-Jun-2022, while FIIs owned 22.63 per cent, DIIs 10.15 per cent.