Gujarat Ambuja: Reaping the benefits - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks


Login Failure
(Please do not use this option on a public machine)
  Sign Up | Forgot Password?  

Gujarat Ambuja: Reaping the benefits

Nov 12, 2001

Gujarat Ambuja recently reported a 19% increase in turnover and a 112% rise in net profit for the first quarter ended September 30 2001. Margins have also shown marked improvement in light of favorable cement prices and various cost cutting initiatives taken by the company.

(Rs m)1QFY011QFY02Change
Sales 2,516 2,993 19.0%
Other Income 37 89 144.1%
Expenditure 1,668 1,938 16.2%
Operating Profit (EBDIT) 849 1,055 24.3%
Operating Profit Margin (%)33.7%35.3% 
Interest (Net) 322 247 -23.4%
Depreciation 312 335 7.4%
Profit before Tax 251 562 124.4%
Tax - 30  
Profit after Tax/(Loss) 251 532 112.4%
Net profit margin (%)10.0%17.8% 
No. of Shares (eoy) (m) 155.1 155.1  
Earnings per share (Rs)* 6.5 13.7  

Production and sale of cement during the aforesaid quarter increased by 15.8% and 13.8% to 1.5 million tonnes (MT) respectively. While cement sales have increased by 13.8%, turnover has gone up by 19.0% in 1QFY02, which indicates that growth was also led by higher realisations thanks to the cartelisation effort. Interest costs, for the second consecutive quarter have been on the decline. The company has been reducing its debt burden from the private placement proceeds in an effort to improve on profit margins.

Key numbers...
(MT) 2QFY012QFY02Change
Clinker 1.1 1.3 16.9%
Cement 1.3 1.5 15.8%
Clinker 0.0 - -
Cement 1.3 1.5 13.8%

During the quarter, the company has allotted 8 m shares at a price of Rs 225 per share on preferential allotment basis to Affinity Investment Ltd., an afilliate of Warburg Pincus. It has also issued 8 m warrants to the same party. Each warrant would be convertible into one share at any time upto September 2002 at a price of Rs 225 per share.

The scrip is currently trading at Rs 160 on a P/E multiple of 11.6x annualised 1QFY02 earnings. In the short term, the buoyancy in cement prices is expected to subdue in the coming quarters in light of a slowdown in the economy and weakness on the industrial production front. However, in the long run, the renewed focus of the government on the infrastructure front would benefit players like Gujarat Ambuja, which are poised to take full benefit of any upturn in cement demand.

Equitymaster requests your view! Post a comment on "Gujarat Ambuja: Reaping the benefits ". Click here!


More Views on News

AMBUJA CEMENT Announces Quarterly Results (1QFY22); Net Profit Up 95.8% (Quarterly Result Update)

Jul 26, 2021 | Updated on Jul 26, 2021

For the quarter ended June 2021, AMBUJA CEMENT has posted a net profit of Rs 12 bn (up 95.8% YoY). Sales on the other hand came in at Rs 70 bn (up 50.3% YoY). Read on for a complete analysis of AMBUJA CEMENT's quarterly results.

AMBUJA CEMENT 2019-20 Annual Report Analysis (Annual Result Update)

Jul 8, 2021 | Updated on Jul 8, 2021

Here's an analysis of the annual report of AMBUJA CEMENT for 2019-20. It includes a full income statement, balance sheet and cash flow analysis of AMBUJA CEMENT. Also includes updates on the valuation of AMBUJA CEMENT.

AMBUJA CEMENT Announces Quarterly Results (4QFY21); Net Profit Up 65.3% (Quarterly Result Update)

Jul 8, 2021 | Updated on Jul 8, 2021

For the quarter ended March 2021, AMBUJA CEMENT has posted a net profit of Rs 12 bn (up 65.3% YoY). Sales on the other hand came in at Rs 77 bn (up 23.4% YoY). Read on for a complete analysis of AMBUJA CEMENT's quarterly results.

Cement Stocks on a Roll: JK Lakshmi & Ambuja Scale New High (Views On News)

Jul 6, 2021

Cement stocks rally owing to firm cement prices and volume growth expectation.

Nuvoco Vistas Makes a Lackluster Debut. Stock Lists at 17% Discount (Views On News)

Aug 23, 2021

Nuvoco Vistas witnessed a tepid listing on the bourses despite strong outlook for the cement sector.

More Views on News

Most Popular

Infosys vs TCS: Which is Better? (Views On News)

Nov 26, 2021

In the post pandemic era, the top two IT companies in India are fighting to capture the growing demand for IT.

This Multibagger Stock Zooms 20% After Dolly Khanna Buys Stake (Views On News)

Nov 24, 2021

Shares of this edible oil company zoomed over 50% in three days after ace investor bought around 1% stake.

6 Popular Stocks that Turned into Penny Stocks (Views On News)

Nov 27, 2021

A look at popular stocks that crashed big time and never recovered, i.e. which went from 'Multibaggers to Multibeggers'.

India's Top 5 Monopoly Stocks to Watch Out for (Views On News)

Nov 30, 2021

These 5 companies dominate their sectors with a huge piece of the pie.

5 Indian Companies Embracing Blockchain Technology (Views On News)

Nov 23, 2021

Blockchain adoption in India was slow in the past. Now, the technology is being well received.


Become A Smarter Investor
In Just 5 Minutes

Multibagger Stock Guide 2022
Get our special report Multibagger Stocks Guide (2022 Edition) Now!
We will never sell or rent your email id.
Please read our Terms


Dec 3, 2021 (Close)


  • Track your investment in AMBUJA CEMENT with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
  • Add To MyStocks