Views on ACC Ltd 2QCY2016 Results: Angel Broking

Views of Mr. Siddharth Purohit (Sr. Equity Research Analyst- Cements, Angel Broking) on ACC Ltd 2QCY2016 Results:

ACC Volumes disappoints, while margins improved

"ACC reported INR 238 cr of PAT for 2QCY16; bottom-line has been little lower than expectations. The company seems reported 1.3% decline in sales volume to 6.12 Mn Tons compared to 6.2 Mn tons. Realization per ton declined 2.7% YoY and hence revenues declined by 3.1% YoY. However, EBITDA margins of 15.9% seem decent and EBITDA growth of 37% is more or less in line with expectations.

"Margins have got a boost backed by 13% decline in power cost per ton to INR 853 and 10% decline in freight cost per ton to INR 1068. Consequently the EBITDA / Ton improved by 39% YoY to INR 746, due to low base effect. While the simplifications of the holding structure is a good move the stock is trading at premium valuations and further rerating will be a function of higher volume and better realization which could take time. We have a NEUTRAL rating on the stock."

Shares of ACC LTD. was last trading in BSE at Rs.1689.95 as compared to the previous close of Rs. 1681.85. The total number of shares traded during the day was 92229 in over 2505 trades.

The stock hit an intraday high of Rs. 1717.15 and intraday low of 1668.1. The net turnover during the day was Rs. 156359518.

Source : Equity Bulls

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