ACC will be reporting its quarterly results today and the cement maker is slated to post good numbers.
- In terms of topline, growth of roughly around 8.5 percent is expected. Majority of that will be driven by higher volumes.
- They have been ramping up capacity utilisation levels. ACC has pan-India presence. So they will gain because prices in north as well as in central India have been higher but they will lose out because in south and east, the prices have been a tad bit weakfish.
- So realisations should be a little bit positive on a year-on-year (YoY) basis but a majority of that topline growth will come in from volumes and volumes are expected to be at around 7.4 million tonnes.
- In terms of margins, some sort of an expansion is expected. Few factors playing out here, operating leverage – they are producing more, so some operating leverage will play out. The second factor will be – they have signed an agreement with Ambuja Cements. So they are working on their freight movement of clinker as well, that is likely to play out and the third factor is the axle load factor. You can load more amount of cement and other raw materials onto the truck and that is likely to play out as well so some sort of a margin expansion is what the street is working with.