Ambuja Cements Q4 preview: Here are projections for this Adani Group stock from Axis, HDFC & two others

Adani Group-owned Ambuja Cement is set to announce its quarterly earnings for the period ending on March 31, 2023. After the acquisition by Adani Group, Ambuja Cements's board approved a change in the financial year from January 1-December 31 every year to April 1-March 31 on September 16, 2022. The latest earnings will be for a period of 15 months.

According to various brokerage firms, Ambuja Cements is likely to report a muted growth, in single digits, in revenues on both year-on-year (YoY) and quarter-on-quarter (QoQ) basis, while profit after (PAT) is likely to decline on a yearly basis. EBITDA margins are likely to remain under pressure, falling in the range of 70-280 basis points (bps).

Axis Securities expects Ambuja Cements to report a revenue of Rs 4,137 crore, rising 5 per cent YoY, while EBITDA is seen at Rs 804 crore, flat YoY due to pressure on EBITDA margins at 19.4 per cent, down 70 bps on a yearly basis. The company may report a flattish profit at Rs 492 crore, but 33 per cent up on a QoQ basis.

Axis Securities said that volumes are likely to grow marginally YoY as a strike at the Himachal plant impacted higher growth, while revenue is to be higher due to higher realization YoY. Gross margin is to be impacted owing to higher operating cost YoY and EBITDA margin to contract YoY owing to higher cost but higher QoQ. PAT is to be marginally lower YoY but higher QoQ but EPS is to be in line with PAT.

Nirmal Bang Institutional Equities (NBIE) expects select cement stocks including Ambuja Cements to report EBITDA/mt of more than Rs1000 on the back of reduced fuel prices and steady demand growth. But, it has maintained a conservative outlook in our numbers.

NBIE pegs Ambuja's revenue at Rs 4,142.1 crore, rising 5.5 per cent YoY but flat on a sequential basis. EBITDA is seen at Rs 750 crore, falling over 5.5 per cent YoY but up about 20 per cent on a sequential basis amid a fall in EBITDA margins at 12.5 per cent for the March 2023 quarter. PAT is seen at Rs 475.5 crore, down 4 per cent YoY.

HDFC Securities has seen net sales at Rs 4,063 crore, up 3.5 per cent YoY, but down 1.6 per cent QoQ. It pegs Ambuja's EBITDA at Rs 702.4 crore, dropping over 11 per cent YoY but 12.2 per cent higher QoQ. EBITDA margins are seen 280 basis points down YoY to 17.3 per cent, while net profit may decline over 17 per cent on a yearly basis to Rs 408.8 crore.

HDFC Securities, which has an 'add' rating on the stock, expects non-south-focused players including Ambuja Cement to report healthy realisation growth of 1-2 per cent QoQ.

Sharekhan by BNP Paribas expects Ambuja Cements to report a 9.3 per cent YoY and 3.9 per cent QoQ rise in revenue to Rs 4,288 crore in the Q4F23. It sees a compression in operating profit margins at 200 bps on a YoY basis to 18.1 per cent. It pegs Ambuja's net profit at Rs 485 crore, dropping over 2 per cent YoY, while it may rise 12.6 per cent on a sequential basis.


(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Business Today)

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