Cement News

ACC share rated ‘buy’; expert says target price Rs 2030, stop-loss Rs 1835


ACC Share price today is Rs 1890, down Rs 24 or 1.2%.  ACC Share price performance over the week has seen it move up by over 2%, from Rs 1861 to Rs 1890. Jefferies says that ACC management remains optimistic on demand growth led by increased government thrust on infrastructure and strong rural housing demand and expects industry to post >10% YoY growth. Jefferies says ACC intends to focus on high contribution markets and increase share of value-added / premium products. It added that ACC outlook is fairly positive as economic recovery is underway led by government focus on infra, particularly roads, railways, affordable housing etc. as announced in the union budget.

Technical Analysis on ACC:

Ashis Biswas, Head of Technical Research at CapitalVia Global Research has revealed his trading strategies regarding ACC. He said, “The stock is trading close to its support zone after a corrective move. ACC had broken its all-time high recently. ACC has picked up momentum since then and seems it is likely to continue going further as well.” 

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Ashis has recommended a buy on ACC with a Target price of Rs 2030. Investors are advised to maintain a Stop-Loss of Rs 1835, he added.  
Key takeaways from ACC’s annual report analysis include:

a)      Management remains optimistic on CY21 demand growth and expects industry to post >10% YoY growth
b)      cost efficiency programme ‘Parvat’ yielded savings
c)      ACC achieved increased synergies with Ambuja Cement
d)      Net cash increased by Rs 12.5 bn to Rs 59 bn.

In investors presentation, it was highlighted that India is the world’s second largest cement producer, with growing demand in the construction, infrastructure, and housing segments. Although India is also the second largest consumer of cement, its per capita cement consumption is significantly lower than the global average, which provides ample headroom for growth. With the Indian economy likely to grow at a much faster clip going forward, cement demand is likely to significantly outpace GDP growth. ACC says that the Cement demand is expected to grow by 15%–17% in CY 2021.

It has also been highlighted that the government’s vision of “Housing for all by 2022” is expected to create lucrative opportunities. Demand for affordable homes is set to stay healthy, supported by a growing population, young demographic profile, shift towards nuclear families and rapid urbanization.

About ACC:

ACC is a leading player in the Indian building materials space, with a pan-India manufacturing and marketing presence. With 17 cement manufacturing units, over 90 ready mix concrete plants, a distribution network of 50,000+ dealers & retailers and a countrywide spread of sales offices.


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