Ambuja Cements: Motilal Oswal Buy, target Rs 750

Why Ambuja Cements is back in focus

Ambuja Cements Ltd shares have been in focus after a set of brokerage notes from Motilal Oswal Financial Services (MOFSL) reiterated a constructive stance on the Adani Group-owned cement maker. Across the notes, the common thread is Ambuja’s faster capacity build-out, a sharper tilt toward organic growth, and an improving profitability outlook. Motilal Oswal has maintained a ‘Buy’ rating in these reports, although the target price and valuation approach vary by note and time period.

The latest market attention also followed quarterly results and the stock’s near-term price movement on the BSE. Ambuja Cements ended 4.11% lower at Rs 593 on a Thursday session mentioned in the article, even as brokerages highlighted earnings growth and operating improvements as key positives.

Motilal Oswal’s ‘Buy’ view and the range of target prices

Motilal Oswal reiterated a ‘Buy’ rating on Ambuja Cements with different targets in different updates cited in the article. One note described a target price of Rs 600, derived by valuing the stock at 17x FY28E EV/EBITDA. Another update after quarterly results said the brokerage raised its target price to Rs 730 from Rs 700 while maintaining a ‘Buy’ rating.

Separately, the article also references Motilal Oswal commentary with a target price of Rs 740 and another with a target price of Rs 750. In one of those instances, the note cited a last traded price (LTP) of Rs 540 and a potential upside of 39%, while another cited LTP around Rs 543 and implied upside of about 38%. These variations reflect different report dates, valuation anchors (FY28E EV/EBITDA or Sep’27E EV/EBITDA), and updated assumptions on profitability and execution.

Earnings growth assumptions used by the brokerage

Motilal Oswal’s notes cited strong earnings trajectories over different forecast windows. One estimate projected consolidated revenue/EBITDA/PAT CAGRs of around 11%/17%/26% over FY26 to FY28. Another estimate projected consolidated revenue/EBITDA/PAT CAGR of about 15%/29%/31% over FY25 to FY27.

The article also references a forecast of about 14%/29%/30% revenue/EBITDA/PAT CAGR over FY25 to FY28E, driven by volume growth of around 11% and profitability improvement. Another cited interaction points to a higher CAGR set of about 17%/35%/36% over FY25 to FY27, described as being on a low base.

EBITDA per tonne: the key profitability lever

A central operational metric in the notes is EBITDA per tonne. One set of projections in the article expects EBITDA per tonne to improve to Rs 1,014 in FY26, Rs 1,150 in FY27, and Rs 1,230 in FY28, from Rs 794 in FY25. Another set expects EBITDA per tonne to rise to Rs 1,048 in FY27 and Rs 1,105 in FY28, compared with Rs 976 estimated for FY26.

In a separate part of the article, the company is also described as reiterating an EBITDA per tonne target of Rs 1,500 per tonne by FY28E, supported by cost savings and a higher share of premium cement. One note highlighted that Ambuja has seen three straight quarters of Rs 1,000-plus per tonne EBITDA.

Q1FY26 results: profit growth cited in the article

Ambuja Cements reported a year-on-year rise in net profit for the first quarter ended June 2025. The article cites a 23.8% YoY rise in Q1FY26 net profit to Rs 969.66 crore. Another reference puts Q1 net profit at Rs 970 crore, up from Rs 783 crore in the same period last year.

Motilal Oswal’s post-results update, as cited, raised the target price to Rs 730 from Rs 700, pointing to robust demand and pricing. The article also notes that PAT fell sequentially, even though the YoY trend was positive.

3QFY26 performance: below estimates due to elevated costs

In a research note dated January 31, 2026, Motilal Oswal said Ambuja Cements’ 3QFY26 operating performance was below its estimates, impacted by elevated opex per tonne including one-off costs. The note cited consolidated EBITDA up about 53% YoY to INR 13.5 billion (Rs 1,350 crore), but still around a 24% miss versus the brokerage’s estimate.

EBITDA per tonne in that quarter was cited at INR 716, versus an estimate of INR 953. Operating profit margin (OPM) expanded by 2.9 percentage points to about 13%, compared with an estimate of around 18%. Adjusted PAT was cited at INR 1.1 billion (Rs 110 crore), down about 76% YoY, with the note attributing the miss to lower EBITDA, lower other income, and higher depreciation.

Capacity expansion, market share and premiumisation cues

Motilal Oswal’s constructive view is linked to Ambuja’s ongoing expansion roadmap and a shift toward organic growth. The article also references management interaction highlights, including market share improving from around 11%-12% to 14.5%, with a target of roughly 17%-18% by FY28E and over 20% by FY30E.

Premium cement mix is another lever cited. The premium share is described as about 24% of trade volume, with about Rs 400 per tonne higher profitability. On capacity, the article includes multiple targets: confidence of achieving 140 mtpa by FY28 in one section, and a raised capacity target of 155 mtpa by FY28 in another, supported by adding an additional 15 mtpa through debottlenecking at various plants.

Valuation metrics cited across notes

The article lists several valuation snapshots. In one section, Ambuja Cements (consolidated) is described as trading at 18x/16x/14x FY26E/FY27E/FY28E EV/EBITDA and at $128/$118/$112 EV per tonne, which the brokerage views as attractive. Another section cites the stock trading at 21x/17x FY26E/FY27E EV/EBITDA and at $158/$151 EV per tonne.

A separate Motilal Oswal note values Ambuja at 20x Sep’27E EV/EBITDA for a target of Rs 750, and also cites trading multiples of 15x/13x FY27E/FY28E EV/EBITDA and $128/$119 EV/tonne versus a last five-year average one-year forward EV/tonne of $170.

Other brokerage calls mentioned alongside Motilal Oswal

The article also references other broker views. JM Financial raised FY26E-27E earnings estimates by 2%-5% after a Q2 beat and projected a target price of Rs 700. ICICI Securities reiterated a target price of Rs 631 based on 17x FY27E EV/EBITDA, while citing strong cost control and 340 bps higher EBITDA margins versus UltraTech.

Elara Capital increased its target to Rs 647 from Rs 631, citing a 58% YoY rise in EBITDA to Rs 1,770 crore, operating cost down 3% YoY, and EBITDA per tonne up 34% to Rs 1,048. Nuvama Institutional Equities suggested a target of Rs 694 after a visit, citing healthy capex plans and cost-efficiency measures.

Key figures snapshot

What investors may track next

The information in the article points to three near-term variables investors typically monitor in cement names: execution of capacity additions and debottlenecking timelines, trajectory of EBITDA per tonne, and the sustainability of demand and pricing that brokerages referenced after quarterly results.

Motilal Oswal’s notes show that even with quarterly volatility and cost-related misses in specific periods, the broader thesis relies on operating leverage from expansion and an improving cost and product mix. Any further updates from the company on capacity milestones, premiumisation progress, or updated profitability targets are likely to remain the key signposts referenced by the broker community.