ACC limited reported its cement dispatches in Sept 2011 has rose by 9.5 percent on a year-on-year (YOY) to 1.73 Million tonnes (MT).
The company’s production for the month of Sept rose to 1.67 MT from 1.52 MT a year ago. Swiss cement producer Holcim holds 46 percent in ACC.
On the other side Ambuja Cement dispatches have rose about 3 percent to 1.55 MT but its production declined to 1.46 MT from 1.48 MT on a year on year basis. The sales figures reported by these cement companies has not surprise analysts as they expect both the cement major Ambuja and ACC to come out with improved volume growth because of stabilized capacities. The stocks ACC closed flat at Rs. 1100 while Ambuja cement closed at Rs 148.85 no change from its previous close on today’s trading.
ACC is a key cement player in India and has a capacity of 30 mpta would partially benefit from realisation in northern, western and eastern regions. Though the earnings have been volatile its 45 percent volumes are from southern and central regions where realisation is unfavourable. Broking Houses have recommended a buy call on Ambuja Cement as the company will gain from improved realisation as it has a greater presence in northern, western and eastern markets in 4th Quarter. The new capacity has stabilised and the demand in these regions will drive volume growth and improve further realisations.
Bell the bull says: Various Broking houses have reviewed the cement ratings and given a buy signal on improved realisation.