The company aims to bring production cost down to Rs 3,650 per tonne and deliver Ebitda per tonne of Rs 1,500 by FY28
As Ambuja Cements’ (ACL) revenue from operations rose to 10,277 crore in the third quarter of the current financial year, Axis Direct has stated that the company is well placed to capture incremental growth. Axis Direct has maintained its buy rating on the stock.
The company is expanding capacity from 109 MTPA to 115 MTPA by FY26. It now targets 155 MTPA by FY28, supported by incremental expansion and debottlenecking initiatives. ACL targets reducing its cost of production to Rs 4,000 per tonne by FY26, with an additional reduction of Rs 300 to 400 per tonne by FY28 through multiple levers, including lowering clinker factor, optimising logistics, increasing green power share, driving blended cement mix and expanding Ebitda margins.
Furthermore, ACL aims to bring production cost down to Rs 3,650 per tonne and deliver Ebitda per tonne of Rs 1,500 by FY28. “The company has guided for double-digit volume growth in FY26, outperforming the broader industry, which is expected to grow at a steady 7 to 8 per cent. Increased investments in roads, railways, urban infrastructure, and commercial development are expected to remain key demand drivers. Against this backdrop, ACL is well placed to capture incremental growth and strengthen its market position,” Axis Direct said in its report.
Cement demand in the current financial year is expected to be supported by sustained momentum in infrastructure spending and continued demand from the housing and commercial segments. The report added that with consolidation accelerating and capacity additions concentrated among top players, market share gains are likely to continue, driving stronger pricing discipline, improved economies of scale, and greater supply chain efficiency.
“The company’s capacity expansion plans are on track and support its goal of increasing market share across key regions. Its strong pan-India presence, ongoing cost control measures, and benefits from integration within the Adani Group position it well to maintain steady growth,” the report pointed out.
Axis Direct added that continued government spending on infrastructure and affordable housing, along with rising private sector investment and healthy demand in real estate, creates a supportive operating environment.
