Shares of Ambuja Cements fell 2.96% to ₹506.65 during Tuesday’s session as leading brokerages adjusted their estimates downward following weak Q3 performance and heightened competitive pressures in the market. The stock faced selling pressure amid concerns over cost savings and growth execution.
Jefferies’ Take on Ambuja Cements: The brokerage retained its ‘BUY’ rating but trimmed its target price to ₹670 from ₹725. Jefferies reduced its consolidated EBITDA estimates for FY25-FY27 by 7-19%, factoring in the weak Q3 results and delays in realizing cost savings. It emphasized that execution would be key to regaining investor confidence.
Nuvama’s View: Nuvama upgraded its rating on Ambuja Cements to ‘BUY’ from ‘HOLD,’ raising the target price to ₹676 from ₹667. Despite revising EBITDA estimates for FY25, FY26, and FY27 downward by 17%, 4%, and 3%, respectively, it highlighted that the stock’s recent decline had made valuations attractive and presented growth potential.
Morgan Stanley’s (MS) Outlook: MS maintained an ‘Overweight’ rating with a target price of ₹675, highlighting that the company’s consolidated EBITDA of ₹17.1 billion was approximately 29% higher than its estimates. The reported EBITDA per tonne was ₹1,038 against their estimate of ₹869. Additionally, Ambuja Cements had a strong cash position of ₹88 billion, which provides support for future growth initiatives.
Stock Performance: The shares traded within a day range of ₹497.10 to ₹528.30, with a market cap of ₹1.11 trillion. The stock has faced volatility due to recent earnings downgrades, but brokerages remain divided on its long-term prospects, making execution and future growth key metrics to watch.
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