(Reuters) -India’s Ambuja Cements said on Monday that its second-quarter profit more than doubled from a year earlier, lifted by a recovery in prices and higher-than-expected volume growth in a seasonally weak period.
The Adani Group firm’s net profit surged to 13.88 billion rupees (about $158 million) in July-September from 5.01 billion rupees last year.
Sales volumes jumped 20%, lifting revenue to 51.39 billion rupees from 40.73 billion rupees. Analysts were expecting volume growth between 5% and 15%, data from five brokerages show.
Ambuja also lifted its production capacity target by fiscal year 2028 to 155 million tonnes per annum (MTPA) from 140 MTPA previously expected. The company has a capacity of about 107 MTPA at present.
Shares of the company were trading 2.5% higher after the results, taking their year-to-date gains to 7.2%.
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KEY CONTEXT
Ambuja, along with Adani-owned ACC, and larger rival UltraTech Cement, have managed to shield their volumes from seasonal volatility through a string of deals, analysts said.
The July-September quarter coincides with India’s annual monsoon rains season, during which construction activity slows and demand for cement sags, pressuring prices.
Cement prices were little changed from a quarter earlier but up 5% year-on-year, Ambit Research data showed.
For much of fiscal year 2025, cement prices corrected from the previous year’s highs amid a drought of new projects and India’s general elections.
Analysts expect cement demand to recover in the second half of fiscal year 2026, as demand spurred by tax cuts trickles in.
PEER COMPARISON
Valuation (next 12 Estimates (next 12 Analysts’ sentiment
months) months)
RIC PE EV/EBI Price/ Revenue Profit Mean No. of Stock to Div
TDA Sales growth (%) growth (%) rating* analyst price yield
s target** (%)
Ambuja Cements 32.24 14.61 3.04 18.86 11.19 Buy 38 0.86 0.35
UltraTech Cement 34.11 18.86 3.65 13.09 34.24 Buy 37 0.87 0.65
Shree Cement 46.25 17.60 4.60 10.62 34.28 Hold 21 0.92 0.55
ACC 16.96 9.22 1.34 10.14 0.36 Buy 20 0.88 0.4
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
JULY-SEPTEMBER STOCK PERFORMANCE
— All data from LSEG
— $1 = 87.8950 Indian rupees
(Reporting by Hritam Mukherjee in Bengaluru; Editing by Rashmi Aich and Subhranshu Sahu)
