Ambuja Cements share price hits 52-week high; 4 cement stocks to buy from large cap, midcap and small cap categories

Shares of Ambuja Cements jumped more than four per cent in early trade on Wednesday to hit 52-week high value of Rs 457.50 amid spurt in volume. The counter opened at Rs 437.20 and rose 4.5% to touch its fresh 52-week high value.  

Meanwhile, the company also clarified over number of shares tendered in connection with an open offer to the shareholders of Ambuja Cements Limited (“Open Offer”) 

"Shareholders are requested to read the number of shares “28,810” as “28,110” in the intimations dated September 5, 2022. 16,177 Equity Shares have been tendered by the Public Shareholders holding Equity Shares in the physical form with the Registrar to the Offer, as per the email received by the Manager from the Registrar to the Offer as of 5.00 pm IST on September 6, 2022," said the company in a regulatory filing on Wednesday.  

Earlie Emkay Research in its report on September 4 has said that season impact persists in the cement sector.

Industry volumes are likely to have risen by a low single-digit YoY, while waning by a mid-single-digit MoM in Aug-22, given the accelerating monsoons, the harvesting season and restriction on sand-mining in several states, which see heavy rains, it said.  

It was of the view that operating costs should peak in Q2FY23 and may decline in coming quarters, with international petcoke prices down ~40% in the past four months to US$175/ton. "Factoring-in the inventory lag (45-90 days), CC ratio of 1.5x and the petcoke usage (~70% in fuel mix), the dip in fuel prices is expected to provide cost savings of at least Rs200/ton from Q3, in our view," it said.  

On trading ideas from this space, It preferred UltraTech Cements and Shree Cement from large cap category space. It picked Birla Corp among mid-caps and Sagar Cements in the small-cap space. For UltraTech, it gave a target price of Rs 7,100 and recommended a buy on Shree Cement for target price of Rs 23,550. It pegged target prices of Rs 969 and 210 for Birla Corp and Sagar Cements respectively.