AMBUJACEM - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 3.3

Here’s a detailed overview of Ambuja Cements Ltd. (AMBUJACEM) — a key player in India's cement industry, showing financial stability and sectoral strength, but trading at a rich valuation amid recent profit moderation.

🧱 Core Financial Metrics

ROE: 8.73%, ROCE: 10.5% — modest return ratios; not standout for capital intensity of the sector.

EPS: ₹16.9 — steady earnings base, but valuation implies strong future expectations.

PAT Qtr: ₹884 Cr. (↓ from ₹2,115 Cr.) — -3.56% decline, suggests one-off boost in prior quarter or margin softening.

Debt-to-Equity: 0.01 — near-zero leverage, indicating strong balance sheet.

Dividend Yield: 0.33% — low payout, signals cash retention strategy.

📊 Valuation Metrics & Outlook

Metric Value Interpretation

P/E Ratio 36.2 Slightly below Industry PE (51.1), but still premium

P/B Ratio ~2.81 Fair for capital-heavy industry

PEG Ratio 2.72 ⚠️ Elevated — suggests price ahead of growth

Intrinsic Value Slightly Below CMP Market pricing in long-term demand rebound

🏗️ Business Model & Strategic Edge

Market leader in cement & clinker, with pan-India distribution network.

Synergies from parent group (Adani) and scale efficiencies.

Focus on green cement, sustainability initiatives, and cost optimization.

Institutional sentiment split

FII Hold ↓ -1.17% — mild exit likely due to valuation concerns.

DII Hold ↑ +1.40% — domestic confidence in long-term prospects.

📈 Technical Analysis

RSI: 65.2 — mildly overbought; potential for sideways consolidation.

MACD: +12.6 — bullish crossover; underlying momentum.

CMP ₹610 trading

Above DMA 50 & DMA 200 — confirms bullish bias.

Still below high ₹687 — scope for rebound if volumes sustain.

🎯 Entry Zone & Investment Strategy

Entry Zone: ₹575–₹590 — attractive zone during technical retracement.

Holding Outlook

Great long-term candidate for infrastructure-driven portfolio.

Best suited for moderate-growth investors focusing on stability and ESG.

Watch for quarterly margin trends, carbon credit benefits, and capacity expansion.

Want help plotting Ambuja against peers like UltraTech, Shree Cements, or Dalmia Bharat on pricing power and ESG adoption? I can create a strategy board tailored to your cement portfolio vision 🧱📊.

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