Cement & Cement Products
ACC is a prominent company operating in the Cement & Cement Products sector in India. It trades under the stock ticker ACC and boasts a market capitalization of Rs. 35,411.9 Crores.
The company specializes in the manufacture and sale of cement and ready-mix concrete, segmented into two primary areas: Cement and Ready Mix Concrete. Its product offerings include:
In addition to its cement products, ACC also provides a variety of construction chemicals such as:
ACC’s product range extends further to include ready-to-use waterproof plasters, thin bed joining mortars, and other specialty construction materials marketed under the ACC Suraksha brand. It also offers EcoMaxx, a green concrete option aimed at sustainability.
The company distributes its products through a well-established network of dealers, retailers, engineers, and architects. Originally incorporated as The Associated Cement Companies Limited in 1936, it rebranded to ACC Limited in September 2006 and is headquartered in Ahmedabad, India. ACC operates as a subsidiary of Ambuja Cements Limited.
Financially, ACC is performing well, with a trailing 12-month revenue of Rs. 22,102.8 Crores and a profit of Rs. 2,597.7 Crores over the past four quarters. It has shown a revenue growth of 35.1% over the last three years and distributes dividends to its investors, with a dividend yield of 0.81% per year. In the last twelve months, it returned Rs. 16.75 dividend per share.
Analysis of ACC's financial performance, highlighting revenue trends, growth patterns, and key metrics through quarterly analysis.
Last Updated: Dec 31, 2024
Description | Share | Value |
---|---|---|
Cement | 94.2% | 5.6 kCr |
Ready Mix Concrete | 5.8% | 344.5 Cr |
Total | 6 kCr |
Summary of ACC's latest earnings call, featuring management's outlook on business performance, financial results, and analyst Q&A sessions that highlight key strategic initiatives and market challenges.
Last updated: Feb 25
The management outlook highlights a positive industry trajectory with cement demand expected to grow 4-5% in FY25, driven by government infrastructure spending and housing sector growth. Ambuja Cements aims to outperform the industry through accelerated expansion, targeting 140 million tons capacity by FY28, including organic projects (e.g., new clinker and grinding units) and acquisitions (Orient Cement). Key initiatives focus on cost leadership: reducing operational costs by 8-10% via green power (200MW solar commissioned, 1,000MW planned), logistics optimization (lower lead distances, rail network efficiency), captive coal mines, and AFR usage, targeting INR3,650/ton by FY28. The company emphasizes ESG commitments (net-zero by 2050, water positivity) and digital transformation for operational efficiency. Financially, a strong balance sheet (INR8,755 crore cash, nil debt) supports aggressive capex (INR9,000 crore FY25). Near-term priorities include ramping up utilization of acquired assets (Sanghi, Penna) and leveraging market leadership in premium products.
Last updated: Feb 25
Question 1: "Adjusted for incentives, it seems like quite a weak quarter operationally... EBITDA per ton is only INR537 per ton... why the performance has dropped so much sequentially?"
Answer: The decline was attributed to higher costs from newly acquired assets (Penna and Sanghi) operating at sub-40% utilization, plant shutdowns for maintenance, and inventory drawdowns. These are temporary issues, with cost improvements expected as utilization ramps up to 70%+ by FY26.
Question 2: "There has been a significant increase in other expenses... How much could be one-off?"
Answer: Higher expenses stemmed from consolidating Penna/Sanghi overheads, shutdown-related maintenance costs, and branding/market share investments. These are partly one-time but reflect upfront costs for future operational leverage benefits.
Question 3: "Adjusted for Sanghi and Penna, growth is tepid... Is that how to look at it?"
Answer: Excluding new acquisitions, Ambuja/ACC's organic volume grew ~7% (vs. industry's ~5%), while new capacity-driven markets grew 11%. Utilization for legacy plants improved to 80% from 76% YoY.
Question 4: "Sequential incentives declined... Can you explain?"
Answer: Incentives fluctuate quarterly due to timing of past-period accruals (e.g., INR130"“135 crore in Q2 for Sankrail vs. Q3's Himachal). Annual incentives are expected to rise to INR600"“650 crore with new capacities.
Question 5: "INR4,500 crore incentives... Over what timeline?"
Answer: These incentives will be realized over 7"“9 years, averaging ~INR500"“600 crore annually, with incremental benefits from expanded capacities.
Question 6: "Cost differential of Penna/Sanghi vs. traditional capacities?"
Answer: Current costs for Sanghi/Penna are ~10"“15% higher due to low utilization and legacy inefficiencies. Initiatives (e.g., waste heat recovery, AFR, branding) aim to align costs with targets (INR3,650/ton) by FY28.
Question 7: "Expected Orient acquisition cash outflow and FY25 closing cash?"
Answer: Orient's acquisition requires ~INR4,000 crore in Q4, reducing cash from INR8,755 crore. Open offer outflows (separate) will occur in mid-FY26.
Question 8: "Time/capex to align Sanghi/Penna costs?"
Answer: Sanghi/Penna require ~INR1,000 crore in upgrades (e.g., WHRS, AFR retrofits) over 12"“24 months. Utilization improvements (to 80%+) and operational synergies will drive cost parity by FY26.
Question 9: "Realization decline despite premium brands... Will pricing stabilize?"
Answer: Lower realizations reflect depressed South markets (OPC-heavy) and B2B sales mix. Price hikes in December/January and premium product focus (27% of trade sales) aim to improve margins in Q4.
Question 10: "Industry supply additions... Impact on pricing?"
Answer: FY25"“27 capacity additions (~50 million tons) will be absorbed by 8% demand growth (30 million tons annually). Responsible capacity expansion and brand premiumization mitigate pricing risks.
Question 11: "Cost reduction roadmap... Capex outlook?"
Answer: Savings (INR100"“150/ton annually) will come progressively from renewables, WHRS, logistics optimization, and captive coal. FY26 capex remains elevated (~INR9,000 crore) for ongoing expansions.
Size: Market Cap wise it is among the top 20% companies of india.
Technicals: Bullish SharesGuru indicator.
Buy Backs: Company has bought back it's stock in the past which is a good thing.
Profitability: Recent profitability of 12% is a good sign.
Smart Money: Smart money has been increasing their position in the stock.
Balance Sheet: Strong Balance Sheet.
Growth: Good revenue growth. With 35.1% growth over past three years, the company is going strong.
No major cons observed.
Comprehensive comparison against sector averages
ACC metrics compared to Cement
Category | ACC | Cement |
---|---|---|
PE | 14.01 | 40.02 |
PS | 1.65 | 2.60 |
Growth | 11.4 % | 1.7 % |
ACC vs Cement (2021 - 2025)
Understand ACC ownership landscape with insights into key distribution patterns, offering investors a clear view of stakeholder dynamics.
Shareholder Name | Holding % |
---|---|
AMBUJA CEMENTS LIMITED | 50.05% |
LICI ULIP-GROWTH FUND | 7.69% |
HOLDERIND INVESTMENTS LTDt | 4.48% |
HDFC MUTUAL FUND-HDFC ARBITRAGE FUND | 3.3% |
ICICI PRUDENTIAL LARGE & MID CAP FUND | 2.87% |
ENDEAVOUR TRADE AND INVESTMENT LIMITED | 2.16% |
SBI ARBITRAGE OPPORTUNITIES FUND | 2.14% |
MIRAE ASSET LARGE & MIDCAP FUND | 1.13% |
TATA BALANCED ADVANTAGE FUND | 1.08% |
Trusts | 0.92% |
Others | 0% |
Distribution across major stakeholders
Distribution across major institutional holders
Investor Care | |
---|---|
Dividend Yield | 0.81% |
Dividend/Share (TTM) | 16.75 |
Shares Dilution (1Y) | 0.00% |
Diluted EPS (TTM) | 137.87 |
Financial Health | |
---|---|
Current Ratio | 1.71 |
Debt/Equity | 0.00 |
Debt/Cashflow | 0.00 |
Valuation | |
---|---|
Market Cap | 36.39 kCr |
Price/Earnings (Trailing) | 14.01 |
Price/Sales (Trailing) | 1.65 |
EV/EBITDA | 8.54 |
Price/Free Cashflow | 25.79 |
MarketCap/EBT | 11.63 |
Fundamentals | |
---|---|
Revenue (TTM) | 22.1 kCr |
Rev. Growth (Yr) | 31.5% |
Rev. Growth (Qtr) | 37.79% |
Earnings (TTM) | 2.6 kCr |
Earnings Growth (Yr) | 103.06% |
Earnings Growth (Qtr) | 446.72% |
Profitability | |
---|---|
Operating Margin | 13.28% |
EBT Margin | 14.16% |
Return on Equity | 15.53% |
Return on Assets | 10.95% |
Free Cashflow Yield | 3.88% |
Detailed comparison of ACC against industry peers, highlighting key financial metrics, valuation ratios, and performance indicators to provide competitive context within the sector.
Ticker | Name | Mkt Cap | Revenue | Price %, 1M | Returns, 1Y | P/E | P/S | Rev 1-Yr | Inc 1-Yr |
---|---|---|---|---|---|---|---|---|---|
ULTRACEMCO | UltraTech CementCement & Cement Products | 3.53 LCr | 72.08 kCr | +7.32% | +26.37% | 56.5 | 4.9 | +3.34% | -2.54% |
AMBUJACEM | Ambuja CementsCement & Cement Products | 1.35 LCr | 36.36 kCr | +3.05% | -14.04% | 24.99 | 3.72 | +8.72% | +36.04% |
SHREECEM | Shree CementsCement & Cement Products | 1.1 LCr | 19.76 kCr | +2.03% | +27.40% | 89.98 | 5.58 | -4.90% | -45.47% |
DALBHARAT | DALMIA BHARATCement & Cement Products | 36.87 kCr | 14.48 kCr | +11.65% | +8.83% | 63.57 | 2.55 | -0.39% | -49.21% |
INDIACEM | India CementsCement & Cement Products | 8.92 kCr | 4.51 kCr | +7.45% | +27.01% | -40.74 | 1.98 | -16.28% | +44.40% |