Posted on March 25, 2025, by Niftynews
Ambuja Cements shares gained nearly 4% in the afternoon trading session on Tuesday, after global brokerage firm UBS upgraded its stock rating to ‘buy’ and raised its target price to Rs 620 from the previous target of Rs 475. This positive upgrade by UBS reflects the brokerage’s optimistic outlook on the company, driven by strong market conditions and growth prospects in the cement sector.
Following the announcement, Ambuja Cements shares climbed 3.76% to Rs 538.50, up from the previous close of Rs 518.95 on the Bombay Stock Exchange (BSE). This surge brought the company’s market capitalization to Rs 1.29 lakh crore, reinforcing investor confidence in Ambuja Cements stock.
UBS Upgrade and Its Impact on Ambuja Cements Shares
UBS’s decision to upgrade Ambuja Cements to a ‘buy’ rating comes amid a broader positive trend in the cement sector. The brokerage cited several key factors contributing to the favorable outlook. Among them are the strong consolidation within the sector, which benefits market leaders like Ambuja Cements, and an anticipated housing upcycle along with the revival of government capex projects that should drive the demand for cement.
Moreover, UBS noted that several cost-reduction factors in the cement industry, including the shift to renewable energy, the greater adoption of waste heat recovery systems, and improved logistics—driven by mergers and rail transport expansion—would further strengthen Ambuja Cements shares and other leading players.
Ambuja Cements Stock Performance and Technical Analysis
On the technical side, Ambuja Cements shares are currently trading lower than their 100-day, 150-day, and 200-day moving averages, but higher than the 5-day, 10-day, 20-day, 30-day, and 50-day moving averages, signaling short-term upward momentum. The Relative Strength Index (RSI) for Ambuja Cements stands at 63, which suggests that the stock is neither overbought nor oversold, indicating a balanced market condition for the shares.
These technical indicators suggest that Ambuja Cements shares could continue to perform well in the near future, benefiting from the positive upgrade and favorable sector outlook.
Strong Profit Growth Boosts Ambuja Cements Stock
The recent surge in Ambuja Cements shares is also supported by the company’s impressive financial performance. For the quarter ending December 2024, Ambuja Cements reported a 242% increase in standalone net profit, which rose to Rs 1,758 crore, compared to Rs 514 crore in the same quarter of 2023. On a consolidated basis, the company’s net profit soared by 140.14% to Rs 2,620 crore from Rs 1,091 crore year-on-year.
On a sequential basis, consolidated profit rose by an astonishing 454%, from Rs 473 crore in the September 2024 quarter. Additionally, consolidated revenue from operations grew by 4.5% to Rs 8,415 crore, compared to Rs 8,052 crore in the same quarter last year. These results showcase the strength and resilience of Ambuja Cements, further boosting investor sentiment toward Ambuja Cements shares.
The Future of Ambuja Cements Shares
Looking ahead, Ambuja Cements shares are well-positioned for continued growth, with UBS’s upgraded target price and the company’s strong financial results providing a solid foundation. The cement sector, driven by infrastructure projects, a housing boom, and cost reductions from green energy initiatives, is likely to fuel future demand for Ambuja Cements products.
Given the company’s solid track record, the recent stock surge, and UBS’s optimistic target price, Ambuja Cements shares are expected to remain an attractive investment. Investors should keep a close eye on the stock as it could continue to benefit from the ongoing strength in the cement sector.
