Ambuja Cements - March 2013 Results Preview - Motilal Oswal

- Dispatches in 1QCY13 are estimated to decline 2% YoY (+12% QoQ) to 6.1mt. Average realizations are expected to improve by 4.7% QoQ (up ~5.5% YoY) to INR4,493/ton.

- EBITDA margin is expected to increase by 5.8pp QoQ (-4pp YoY) to 24.3%, impacted by lower realizations, higher freight cost and negative operating leverage. EBITDA/ton is estimated to improve by ~INR296/ton QoQ (-INR114/ton YoY) to INR1,090/ton.

- PAT estimated to remain flat YoY (+121% QoQ) at INR5.1b.

- We downgrade EPS estimates by 7.7%/7.1% for CY13E/CY14E to INR10.1 and INR12.4 respectively to factor the reduction in volumes and realizations.

- The stock trades at 13.7x CY14E EPS, 6.9x EV/EBITDA and USD122/ton. Maintain Buy with a target price of INR190 (9x CY14E EV/EBITDA).

Source : Equity Bulls

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