IIFL has maintained its reduce rating on ACC with a price target of Rs 456 in its March 27, 2009 research report.
“ACC’s balance sheet continues to be strong, with CY08 net cash at Rs 6.8 billion (as against Rs 7.1 billion in CY07). Return ratios, which started to decline in 2007, again dropped in 2008. We expect the declining trend in return ratios to continue in 2009 and 2010, on a decline in profitability. ACC continues to be the most expensive stock in our cement universe on P/BV basis. We maintain our REDUCE rating on the stock with a target of Rs 456,” says IIFL’s research report.
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