Ambuja Cements (ABUJ.BO): 1Q Cost Improvement Helped Offset Weak Volumes/Muted Prices; Capacity, Volume, Price Uncertainty

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Ambuja Cements (ABUJ.BO): 1Q Cost Improvement Helped Offset Weak Volumes/Muted Prices; Capacity, Volume, Price Uncertainty

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28 Jul 2026 14:24:17 ET │ 15 pages

Ambuja Cements (ABUJ.BO)

1Q Cost Improvement Helped Offset Weak Volumes/Muted Prices;

Capacity, Volume, Price Uncertainty

CITI'S TAKE

At Rs15.9bn (10% ahead on costs), consolidated EBITDA fell ~20% YoY on Neutral

lower volumes, realizations (-2%), and higher costs (+3%). EBITDA/t: Rs920

vs. Rs730 in 4Q, Rs1,055 last year; QoQ increase on lower costs (Rs206/t of Price (28 Jul 26 15:30) Rs426.30

cement) and ~1% higher realizations. Ambuja has been an outlier vs. peers Target price Rs450.00↓

on volumes (8% decline YoY vs. positive growth for others) and realizations

from Rs465.00(Ambuja’s QoQ growth is 1%; most peers have reported 4%+). Ambuja is

confident about its 8% volume growth target for FY27 as it increases trade Expected share price return 5.6%

sales, making the 9M ask rate ~12%. Its cost target of Rs4,250 for FY27 is in Expected dividend yield 0.5%

line with 1Q, i.e., incremental external cost inflation will be offset by internal

Expected total return 6.0%efficiencies. It appears ongoing capex is also delayed. Growing uncertainty

around capacity growth, volume, and pricing is a cause for concern and Market Cap Rs1,059,278M

discounted to some extent in valuations (EV/t $105). Neutral; TP now Rs450 US$11,044M

(from Rs465).

Key call highlights — (1) Volume strategy: Ambuja’s 1Q volumes fell ~8% YoY, with

2% decline in trade volumes, 21% decline in non-trade. Overall utilization ~65% vs. Price Performance

77% in 4Q. The company is maintaining its 8% volume growth target for FY27, with a

(RIC: ABUJ.BO, BB: ACEM IN)key focus on trade sales (July trade volumes up 8% YoY). Trade proportion in 1Q ~78%

vs.