Cement Stocks Soar Amid Nationwide Price Hikes

3 Apr 2024 , 01:06 PM

Cement stocks surged on April 2 following reports of average price hikes ranging from ₹10-15 per bag by cement companies nationwide. UltraTech Cement, Shree Cements, Ambuja Cements, ACC, and Dalmia Bharat witnessed gains of one to three percent in trading.

Cement companies announced price hikes varying from ₹10-15 per bag in the north to ₹40 per bag in the central and eastern regions, with expectations of sustaining at ₹10-20 per bag. In the west, a price increase of ₹20 per bag was announced.

Factors such as March stocking, labor shortages during Holi and Lok Sabha elections may influence cement demand in April, raising concerns among dealers about the sustainability of announced price hikes.

Anand Rathi Research favors Shree Cement and UltraTech Cement among large caps, while Prabhudas Lilladher identifies Ultratech, Ramco, and Sagar Cement as major beneficiaries in the Southern region due to price hikes. JK Cement, Shree Cement, JKLC, and Ambuja are favored in the Northern region, and Ambuja, Birla Corp, and UltraTech in the Western region.

Cement volume growth is estimated at a CAGR of 5-6.5% for FY25 and FY26 due to significant capacity additions and moderation in growth. Pan India average capacity utilization levels are expected to remain below 70% over the medium term, with cement prices forecasted to decline by 2-3% in FY25 due to demand-supply dynamics and increased competition.

For feedback and suggestions, write to us at [e-mail]