ACC Limited is in focus after Deven Choksey Research reiterated an Accumulate stance with a target price of Rs 1,554, implying 12% upside from the current market price of Rs 1,392. The note, dated July 10, 2026, portrays a company that is steadily strengthening its competitive position through capacity expansion, operational integration and a more premium product mix. It also warns that near-term margins may stay under pressure because of elevated fuel, coal and packaging costs. Even so, the brokerage sees the long-term setup improving as the Adani Cement ecosystem deepens and the proposed merger with Ambuja Cements advances.

What the research house says

The central thesis is straightforward: ACC is moving through a period of transition in which growth remains intact, but profitability is being squeezed by input costs. Deven Choksey expects Q1FY27 cement volumes of 11.5 million tonnes, broadly flat year on year and down 3.4% sequentially, while realizations should rise about 2.5% quarter on quarter. That combination points to revenue of Rs 70.8 billion, up 16.7% year on year. The brokerage’s view is that volume discipline, better pricing and a richer premium mix can support the stock, even if earnings lag in the near term.

Capacity and integration

ACC’s biggest structural support comes from capacity growth and tighter integration within the Adani Cement framework. The company is commissioning 3.4 MTPA at Salai Banwa in Uttar Pradesh and Kalamboli in Maharashtra, lifting total cement capacity from 40.4 MTPA to 43.8 MTPA. The report says green power already contributes 31% of the energy mix, which should help cost competitiveness over time. It also highlights the proposed merger with Ambuja Cements as a potential source of operating synergies, with completion expected by the end of 2026.

Volumes and realization

The brokerage expects demand conditions to be softer in the first quarter of FY27 than they were in FY26, but not weak enough to derail the broader trend. ACC is projected to sell 11.5 MT, with realizations improving because of price hikes and a premium product mix that has reached 45% of trade sales. That premium tilt matters because it supports better pricing power and a healthier product profile. In a market where cement prices can turn quickly, even modest realization gains can materially affect operating performance.

Margin pressure stays real

The report is notably cautious on margins. Pet coke prices climbed to USD 160 per MT in April before easing to USD 135 in June, while imported thermal coal prices rose about 20% sequentially and polypropylene bag costs also moved higher. On that basis, Deven Choksey estimates EBITDA at Rs 6.7 billion and PAT at Rs 3.5 billion, implying year-on-year declines of 13.6% and 8.4%, respectively. EBITDA per tonne is projected at Rs 581, up Rs 54 quarter on quarter, but still not enough to fully offset the cost squeeze.

Industry backdrop

The broader cement industry had a strong FY26, with volume growth of 8% backed by infrastructure spending and retail housing demand. For Q1FY27, however, the brokerage expects demand growth to moderate to 5%–6% year on year because of heatwaves, labour shortages, election-related disruption and slower construction activity in May and June. Pan-India cement prices have risen to around Rs 345 per bag after April-May hikes of Rs 6-Rs 7 per bag, but pricing momentum is expected to stay muted through the monsoon. The report also says another 30 MT to 34 MT of industry capacity may come on stream in FY27, which could keep pricing power subdued.

Levels and investor focus

For investors, the key level is clear: Deven Choksey has set the target at Rs 1,554 against the current market price of Rs 1,392, translating into 12% upside. The stock’s 52-week range stands at Rs 1,250 to Rs 2,028, which shows that the current quote is still well below the peak but above the yearly floor. The research house’s stance is not an aggressive Buy, but a measured Accumulate call, which signals selective confidence rather than outright enthusiasm. For market participants, that usually means the stock is viewed as investable on weakness, not as a momentum trade.

Financial snapshot

The table underscores a familiar story: revenue is holding up, but the margin structure is weaker than a year ago. EBITDA margin is expected at 9.4%, down from 12.7% in Q1FY26, while PAT margin is forecast at 5.0% versus 6.3% a year earlier. That gap reflects the mismatch between moderate pricing gains and stubborn cost inflation.

Shareholding and watchpoints

Promoter holding remains steady at 56.69%, while FIIs and DIIs together account for a meaningful institutional presence. That ownership mix suggests the stock continues to attract professional attention, even as the earnings cycle stays uneven. The report says one of the near-term monitorables is the commissioning of fresh capacity, alongside progress on the ACC-Ambuja merger and the resignation of Chief Digital Officer Madhavi Isanaka, effective June 30, 2026. Together, these items will shape sentiment around execution, integration and digital strategy in the months ahead.