Cement Stocks Outlook for the week – 04 to 08.01.2016
(In narrow range with negative bias
next week)
Stocks
of cement manufacturers are seen in a narrow range with a
negative
bias next week, as demand for the building material remains
poor
in large parts of the country and pricing power of companies
continues
to be weak.
Cement
companies' stocks have been underperforming the broader
market
over the past few months. The near term prospects of some stocks
such
as UltraTech Cement and JK Lakshmi Cement.
UltraTech
Cement is best geared up to take advantage of any spurt in
demand
in the local market, should road laying activity pick up. The
cement
sector is betting big on road construction for its volumes to rise.
In
the next two years, the road transport ministry has targeted laying
roads
at a rate of 30 km per day, compared with 18 km per day at present.
Meanwhile,
the real estate sector conventionally cement companies'
biggest
consumer is expected to remain a laggard.