Ambuja Cements: 240-260 Zone May Be A Big Hurdle & At Current PE Of Around 45, May Be Quite Expensive Too Despite Growth Story Of Cement

Trading Idea: Ambuja Cements

CMP: 228

Either sell around 235-245 OR on rise around 255-265;

TGT: 224*-214-205-195-180*-170-160*-150

TSL> 248 OR > 275

Note: Consecutive closing (3 days) above 275 for any reason, Ambuja Cements may further rally up to 287-295* & 335-350 in the near to long term (alternative bullish case scenario from the current trading level).

For Ambuja Cements: As par Indian FY (APR-MAR); it maintained JAN-DEC FY

Q4FY16 TTM EPS: 5.12 (Q1FY17 TTM/Actual)

Projected FWD EPS: 6.75-8.85-11.25 (FY:17-19/Estimated)

Average PE: 28

Last 5 yrs average PE : 25

Ideal PE should be around :25-30 (keeping in mind the expected infra spending & growth potential of cement sector).

Last 5 QTRS average EPS: 1.45

Last 5 yrs average EPS: 7.95

As par BG metrics and current market volatility:

Present fair value may be around: 180 (FY:16/TTM)

Projected fair value might be around: 205-235-265 (FY:17-19/FWD)

 

AMBUJACEM	EPS	BV	P/E	Low	High	Median	200-DEMA	10-DEMA
Q4FY16/TTM	5.12	66.41	28	175.16	178.85	177.01	214.02	223.12
FY17/FWD	6.75	72.75	28	201.12	205.35	203.24	214.02	223.12
FY18/FWD	8.85	79.85	28	230.29	235.14	232.71	214.02	223.12
FY19/FWD	11.25	87.25	28	259.65	265.11	262.38	214.02	223.12

Analytical Charts: