www.rupeedesk.in
We remain positive on cement stocks going into next week, but expect some profit
booking following a strong rally this week. Most cement stocks outperformed the
benchmark indices this week, rising 4.5-14.3% against a 4.0% rise in the 50-stock Nifty.
This was primarily on account of the positive sentiment arising from the price hikes
undertaken by most companies in February. In Delhi and Punjab, cement companies
hiked prices by 5-15 rupees per bag. In Rajasthan and Gujarat, prices were increased by
30-35 rupees per bag. Despite the bleak long-term demand scenario, margins of
companies are seen benefiting from the price hikes. Any downside in the stocks may be
capped by expectation of further hikes in prices this month. Cement dealers have already
intimated that prices are likely to be increased this month by another 15 rupees owing to
pick-up in demand.
We remain positive on cement stocks going into next week, but expect some profit
booking following a strong rally this week. Most cement stocks outperformed the
benchmark indices this week, rising 4.5-14.3% against a 4.0% rise in the 50-stock Nifty.
This was primarily on account of the positive sentiment arising from the price hikes
undertaken by most companies in February. In Delhi and Punjab, cement companies
hiked prices by 5-15 rupees per bag. In Rajasthan and Gujarat, prices were increased by
30-35 rupees per bag. Despite the bleak long-term demand scenario, margins of
companies are seen benefiting from the price hikes. Any downside in the stocks may be
capped by expectation of further hikes in prices this month. Cement dealers have already
intimated that prices are likely to be increased this month by another 15 rupees owing to
pick-up in demand.
