Jeffries sees 11% upside potential in India’s largest cement producer, UltraTech Cement’s stocks following their acquisition of Kesoram Industries and has recommended a buy with an upside target of Rs 9,700.

UltraTech Cements nodded to acquire Kesoram Industries’ cement assets in a share-swap deal for an enterprise valuation of Rs 7,600 crore, which is expected to be completed in 9-12 months, is subject to regulatory approvals. “The acquisition is likely to further strengthen the Numero Uno position of UltraTech Cement in the Indian cement industry. The valuation appears tad on the higher side in the background of recent acquisition value of Sanghi Inds by Ambuja Cements / JPA assets by Dalmia or the phase 2/3 expansion unit capex of UltraTech,” said Jefferies in its report. 

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