ACEM: Good cost control but sustained execution is key to watch

Research evidence excerpt

ACEM: Good cost control but sustained execution is key to watch

Update

July 29, 2026 02:22 AM GMT

Morgan Stanley India Company Private Limited+MIndia Materials | Asia Pacific Rahul Gupta

Equity Analyst

ACEM: Good cost control but Rahul.Gupta1@morganstanley.comRuchika A Dhanuka +91 22 6118-2233

Research Associate

Ruchika.Dhanuka@morganstanley.com +91 22 6118-2112

sustained execution is key to

watch

What’s Changed India Materials

Asia Pacific ACC Ltd. (ACC.NS) From To

Industry View In-Line

Price Target Rs1,355.00 Rs1,215.00

Ambuja Cements Ltd (ABUJ.NS)

Price Target Rs515.00 Rs475.00

Recalibrated approach meant that volumes and realizations

were weaker than industry trends, but cost control was

achieved. We see this as a good starting point but sustained

execution is key to watch over the next few quarters. Until then

we think the stock lacks re-rating triggers. Maintain EW.

See results snapshot. We discuss key takeaways from the conference call below.

As guided earlier, management recalibrated the business sharply: In lieu of

recalibrating the business approach, the company is looking to maximize value vs.

volumes.. Overall cement volumes moderated 7% YoY. Within this, the trade

segment declined ~2% YoY while non-trade volumes fell ~21% YoY. By region, the

South showed sharp cuts in low-margin non-trade volumes – the company is now

focusing on deepening its channel network in the region to expand trade share.

Share of the trade segment stood at 78%; management mentioned that it would like

to keep this >75%. On growth from here, management noted that it would continue

to focus on the trade segment and premiumization and aims for trade volume

growth at ~8% YoY in F27. We are estimating overall sales volume growth at 3%

YoY in F27.