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ACC: Rights issue goes through - Views on News from Equitymaster
 
 
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  • Aug 6, 1999

    ACC: Rights issue goes through

    The rights issue of the Associated Cement Companies has been over subscribed by approximately 10-15%. The company had planned to mobilise Rs 1.67 bn via the rights issue. The company is raising money to repay its debt and also to embark on an expansion of capacity.

    ACC, India's second largest cement producer, has an aggregate cement capacity of 11.3 mn tpa.

    The reduction in debt will lift the bottomline to the extent the interest cost is reduced. This will improve the leverage ratios of the company and help lower the overall cost of debt.

    In view of the rising demand scenario, the company is also firming up its plans to set up a unit at Wadi (Maharashtra). An expansion in capacity will help the company in maintaining market share in a fast growing market. Moreover, an expansion will result in economies of scope thus giving the company a competitive advantage over its peers with smaller capacities.

    Market View:
    The stock has been rated as a 'BUY' on account of the strong recovery in demand and consequently the prices of cement. Moreover, the company's initiatives in controlling costs and increasing efficiency is expected to drive earnings growth.

     

     

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    More Views on News

    ACC: Cementing Growth through Capacity Expansion and Favorable Sectoral Developments (Quarterly Results Update - Detailed)

    Jul 20, 2017

    Expanded capacity helped ACC strengthen its market presence in eastern region during the quarter ended June 2017.

    ACC: Jan-March Quarter Sales up 9% YoY, Margins Dip (Quarterly Results Update - Detailed)

    May 4, 2017

    Expanded capacity results in topline growth during the quarter ended March 2017.

    ACC: Demonetisation Takes Toll on Volumes (Quarterly Results Update - Detailed)

    Feb 20, 2017

    Demonetisation hits cement demand during the quarter ended December 2016.

    UltraTech: Post-Acquisition Cement Capacity Augmented to 93 MTPA (Quarterly Results Update - Detailed)

    Aug 11, 2017

    UltraTech Cement completed the acquisition of cement plants of Jaiprakash Associates Limited (JAL) and Jaypee Cement Corporation Limited (JCCL) during the quarter ended June 2017.

    Ambuja Cement: Fall in Other Income Drag Bottomline Lower (Quarterly Results Update - Detailed)

    Aug 11, 2017

    While topline witnessed growth on the back of higher cement sale volumes, a 50.5% YoY fall in other income weighed on Ambuja's bottomline during the quarter ending June 2017.

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