Fact based stock research
Ambuja Cements (BSE:500425)

INE079A01024

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Ambuja Cements stock research in summary

ambujacement.com

ANALYSIS: With an Obermatt Combined Rank of 97 (better than 97% compared with investment alternatives), Ambuja Cements (Construction Materials, India) shares have much better financial characteristics than comparable stocks. Shares of Ambuja Cements are low in value (priced high) with a consolidated Value Rank of 39 (worse than 61% of alternatives). But they show above-average growth (Growth Rank of 73) and are safely financed (Safety Rank of 93, which means below-average debt burdens). ...read more

RECOMMENDATION: A Combined Rank of 97, is a strong buy recommendation based on Ambuja Cements's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Ambuja Cements exhibits low value (Obermatt Value Rank of 39), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 73). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 93) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	39
Growth Rank	73
Safety Rank	93
Combined Rank	97

Country	India
Industry	Construction Materials
Index	Low Emissions, Good Governace Growth Markets, Independent Boards Growth Markets
Size class	X-Large

This stock has achievements: Top 10 Stock.

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Ambuja Cements

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	63	51	39	39
GROWTH
GROWTH	81	57	59	73
SAFETY
SAFETY	88	89	98	93
SENTIMENT
SENTIMENT	n/a	41	26	^new
360° VIEW
360° VIEW	n/a	79	56	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 31-Mar-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Ambuja Cements is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	63	51	39	39
GROWTH
GROWTH	81	57	59	73
SAFETY
SAFETY	88	89	98	93
COMBINED
COMBINED	100	89	53	97

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Ambuja Cements the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 39 (worse than 61% compared with alternatives), Ambuja Cements shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators where three out of four are below average for Ambuja Cements. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with a Price-to-Book Rank of 58, which means that the stock price is lower compared with invested capital than for 58% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 34 which means the stock price compared with what market professionals expect for future profits is higher than 66% of comparable companies, indicating a low value concerning Ambuja Cements's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 58 and for the dividend yields rank which is lower than for 66% of comparable companies, making the stock more expensive as regards to with the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 39, is a hold recommendation based on Ambuja Cements's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for Ambuja Cements, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	40	51	30	34
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	51	54	23	36
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	34	56	53	58
DIVIDEND YIELD
DIVIDEND YIELD	86	46	46	34
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	63	51	39	39

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Ambuja Cements; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 73 (better than 73% compared with alternatives), Ambuja Cements shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Ambuja Cements. Sales Growth has a rank of 94 which means that currently professionals expect the company to grow more than 94% of its competitors. Stock Returns are also above average with a rank of 81. But Capital Growth has only a rank of 14, which means that currently professionals expect the company to grow its invested capital less than 86% of its competitors. Profit Growth is also low, with a rank of only 49, which means that, currently, professionals expect the company to grow its profits below average. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 73, is a buy recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 81% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	51	15	50	94
PROFIT GROWTH
PROFIT GROWTH	68	46	69	49
CAPITAL GROWTH
CAPITAL GROWTH	n/a	96	55	14
STOCK RETURNS
STOCK RETURNS	94	65	35	81
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	81	57	59	73

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Ambuja Cements.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 93 (better than 93% compared with alternatives) for 2024, the company Ambuja Cements has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Ambuja Cements is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Ambuja Cements. Leverage is at a rank of 90, meaning the company has a below-average debt-to-equity ratio. It has less debt than 90% of its competitors. Liquidity is also good at a rank of 86, meaning the company generates more profit to service its debt than 86% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 49, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 51% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 93 (better than 93% compared with alternatives), Ambuja Cements has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Ambuja Cements. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. Investors may have a short-term debt challenge with Ambuja Cements and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	86	90	90	90
REFINANCING
REFINANCING	24	43	57	49
LIQUIDITY
LIQUIDITY	100	90	92	86
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	88	89	98	93

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Ambuja Cements and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	60	39	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	2	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	78	43	^new
MARKET PULSE
MARKET PULSE	n/a	40	21	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	41	26	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Ambuja Cements.
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