Expert recommends BUY ACC with price target of Rs 2100, stop-loss Rs 1850 -

Expert recommends BUY ACC with price target of Rs 2100, stop-loss Rs 1850

Rohit Singre, Senior Technical Research Analyst at LKP Securities said that ACC has witnessed multi year breakout on monthly chart along, ACC has given breakout from ascending channel, the stock should be bought with stop-loss below 1850 and price target of Rs 2100. ACC share price closed yesterday at Rs 1884, up Rs 47 or 2.5%. ACC share price has moved down from 1991 to Rs 1884 in the last 1 week.

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Speaking on the reasons that will fuel ACC share price, Avinash Gorakshkar, Head of Research at Profitmart Securities said, “After budget 2021, focussing upon the infrastructure sector, cement market outlook is quite promising. When it comes to ACC, it’s an MNC company which has a presence across India. So, in the coming times, ACC business is expected to remain strong as infrastructure push will certainly get converted into the high volume growth of the company. Apart from this, cement prices are also expected to rise and the company will benefit from that also.”

ACC Background:

ACC is a leading player in Indian building materials space with a pan-India operating and marketing presence. It has 17 cement plants, 80 RMC (ready mixed concrete) plants, and a wide distribution network of 56,000 channel partners.

ACC’s Management commentary:

Jefferies says that ACC Management’s Outlook is fairly positive as economic recovery is underway led by government focus on infra, particularly roads, railways, affordable housing etc. as announced in the union budget.

KEY Highlights from ACC Investor Presentation:

1)     Affordable Housing Segment to be a Key Driver for the Cement Sector:

ACC at its recent Investors Presentation highlighted that the government’s vision of “Housing for all by 2022” is expected to create lucrative opportunities for ACC. In 2020, around 586.05 lakh tonnes of cement were used at the start of construction work. Demand for affordable homes is set to stay healthy, supported by a growing population, young demographic profile, shift towards nuclear families and rapid urbanization.

2)     ACC is Expanding Capacities to Capitalise on Opportunities:

With projected increase in cement demand, expansion has been kick-started to increase clinker and cement capacities in the attractive markets of East and Central region.

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