Sensex opens flat, Nifty hovers around 8950; Kotak Bank gains 2%
While assigning overweight rating to Ambuja Cements with a target price of Rs 250 post company's annual report, JPMorgan says announcement of greenfield expansion stands as a key positive for the company. ACC-Ambuja restructuring got its FIPB nod and deal conclusion in CY16 is a step forward towards realising potential synergy gains over the medium term, it believes.
JPMorgan estimated ex-south industry growth to be lower at sub 2 percent levels, implying that the market share loss for Ambuja is not as severe as market perception. Capacity utilisation has come down to 71 % levels thereby providing scope for robust volume growth as industry demand trends recover, it says.
Per Ambuja Cements, it feels CY17 is likely to be yet another challenging year though medium term outlook remains positive on the back of government infra focus and affordable housing policies.
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