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Informist, Thursday, Jul. 24, 2025

 

By Shakshi Jain

 

NEW DELHI – ACC Ltd. is expected to post a healthy set of year-on-year bottom line and top line growth numbers for the June quarter, helped by an improvement in both realisations and volumes.

 

Sequentially, the company's performance is expected to register a decline as the June quarter is seasonally weak for cement companies in India due to a slowdown in construction activity with the onset of monsoon. Further, this year, extreme heatwaves and the early arrival of monsoon hurt business for companies in the sector, according to analysts.

 

The Adani group company is expected to post a consolidated net profit of INR 5.59 billion for the June quarter, up 55% on year, according to the average of estimates from 10 brokerages. Sequentially, this would mean a fall of over 25%. The highest estimate for net profit was INR 8.43 billion from YES Securities Ltd. while the lowest was INR 4.76 billion by Prabhudas Lilladher Pvt. Ltd.

 

The company's consolidated revenue for the reporting quarter is expected to have grown nearly 12% on year to INR 57.56 billion. Sequentially, this implies a decline of over 5%. The highest estimate for revenue was INR 62.31 billion from YES Securities and the lowest was INR 55.49 billion by Kotak Institutional Equities.

 

ACC will announce its June quarter earnings Thursday. In the March quarter, ACC's consolidated net profit had fallen more than 20% on year to INR 7.51 billion. However, its revenue had risen nearly 13% on year to INR 59.92 billion. Sequentially, the company's bottom line had declined over 31% in the March quarter while its revenue had risen 15%.

 

Brokerages estimate the company's sales volume rose 4-13% during the June quarter. In the year-ago quarter, the company had clocked cement and clinker sales of 10.2 million tonnes. Earnings of the company in the June quarter were also helped by higher prices, they said. Motilal Oswal expects blended realisations for the company to have improved 6% on year in the June quarter while Kotak Institutional Equities estimates a 3.5% rise.

 

Prabhudas Lilladher Institutional Equities expects ACC to be a key beneficiary of higher prices in the southern and eastern regions of the country, which saw the steepest price hikes by cement companies during the June quarter.

 

ACC is expected to report earnings before interest, taxes, depreciation, and amortisation of INR 9.04 billion for the June quarter, as per the average of estimates from 10 brokerages. The estimates for EBITDA are in the range of INR 7.62 billion to INR 12.28 billion.

 

According to brokerages, ACC's EBITDA per tonne of cement sold in the June quarter is expected to rise to INR 705-INR 992, primarily led by higher prices. This implies a rise of 6-49% on year over EBITDA per tonne of INR 664 in the year-ago period. However, some brokerages anticipate a marginal rise in cost per tonne, on year as well as sequentially, due to operating deleverage and slightly higher fuel costs.

 

On expectations for the industry going forward, brokerages are of the view that demand for cement in the current financial year will pick up pace as against subdued offtake in the previous financial year. Further, operating expenses of cement companies are expected to continue to decline, aided by a rising share of renewable energy and logistical efficiencies. Nuvama Institutional Equities anticipates further consolidation in the sector, however, at a gradual pace.

 

"During the peak monsoon ahead, we expect the IHB (individual home builder) segment to provide some support led by interior work and pricing to remain subdued," Prabhudas Lilladher Institutional Equities said in a report. Yes Securities warned the recent global geopolitical developments could push energy costs higher for these companies in the coming quarters.

 

At 0929 IST, shares of ACC were at INR 1,952.40 on the National Stock Exchange, up 0.1%. The stock is down 5.5% from its closing price on Apr. 24, when the company reported its results for the March quarter. 

 

Of the 19 research reports on the company available with Informist, 14 have a 'buy' or equivalent rating on ACC, four have 'hold' rating and one has a 'sell' recommendation. The average target price of the buy recommendations is INR 2,360.

 

Following are the Apr-Jun earnings estimates for ACC based on reports from 10 brokerages in the descending order by the estimate of net profit:

 

Brokerage firm	Net sales	Net profit	EBITDA
YES Securities (India) Ltd	62,314.00	8,428.00	12,277.00
HDFC Securities Ltd	58,303.00	5,718.00	9,677.00
Nirmal Bang Equities Pvt Ltd	56,819.00	5,583.00	7,922.00
Systematix Shares and Stocks (India) Ltd	55,700.00	5,500.00	9,200.00
ICICI Securities Ltd	57,159.00	5,485.00	8,410.00
Dolat Capital Market Pvt Ltd	59,551.00	5,277.00	9,105.00
Nuvama Wealth Management Ltd	55,567.00	5,129.00	7,618.00
JM Financial Institutional Securities Pvt Ltd	58,577.00	5,108.00	8,967.00
Kotak Institutional Equities	55,488.00	4,939.00	8,618.00
Prabhudas Lilladher Pvt Ltd	56,119.00	4,761.00	8,612.00
Average	57,559.70	5,592.80	9,040.60

 

End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Avishek Dutta

 

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