Higher Cement Prices In North India To Aid Ambuja Cements’ Profitability
Ambuja Cement’s third quarter earnings likely to be a mixed bag.
Ambuja Cements Ltd.’s July to September quarter profit is expected to rise 59 percent on a year-on-year basis to Rs 244 crore, according to the Bloomberg consensus estimates. For the quarter however, profit is likely to decline 39 percent.
The improvement in profitability is expected to be more pronounced for north-based players like Ambuja Cements on account of higher cement prices. The company has no exposure to South India where prices were lower on a year-on-year basis.
Net sales is expected to fall 16.6 percent on a quarter-on-quarter basis, but rise 1.13 percent on the year to Rs 2,118.9 crore, according to an average of estimates of analysts polled by Bloomberg.
Earnings before interest, tax, depreciation and amortisation is likely to fall 34.6 percent on a quarterly basis, but rise 26.8 percent on a year-on-year basis to Rs 393 crore. Lower sequential volumes and increase in fuel prices is expected to have some negative impact on the operating performance of the company. However, pricing improvement may lead to higher EBITDA on a yearly basis.
What To Watch
- Consolidated financials will include its 50.05 percent stake in ACC
- Updates on merger synergies with ACC
These expectations have been compiled from reports of HDFC Securities, ICICI Securities, Elara Securities and Karvy Stock Broking.