Cement Stocks Outlook for the week – 03 to 07.07.2017
Cement Stocks Outlook for the week – 03 to 07.07.2017
( www.rupeedesk.in )
Stocks of cement companies are seen trading on a mixed note next week, as industry will try to
come to terms with the goods and service tax, which will be rolled out on Saturday. Under the new
indirect tax regime, cement has been kept under the 28% tax slab, which is seen as a positive for the
industry.The current tax on cement, including value added tax and other local taxes, is 29-31% in different states. As such, the cost for cement companies would come down by 1-2%, which they might pass on to customers. Cement firms are also seen saving on logistics costs by having fewer and bigger warehouses, rather than many smaller warehouses in different states. As cement dealers don't keep high inventories of cement because of its limited shelf life, the new tax regime is not seen significantly affecting supply of the commodity. Monsoon is a weak season for cement. So, the affect of GST should not linger for long. Typically, the demand for cement falls during monsoon, as construction work almost comes to a standstill because of rains. Cement demand is expected to raise post monsoon and if any short-term disruption is caused by GST, it will settle by that time.
Source : Cogencis Information Services Ltd.
Free Intraday Tips : Join Our Whatsapp No : 9841986753
Free Commodity Tips : Join our Whatsapp No : 9094047040
Cement Stocks Outlook for the week – 03 to 07.07.2017
( www.rupeedesk.in )
Stocks of cement companies are seen trading on a mixed note next week, as industry will try to
come to terms with the goods and service tax, which will be rolled out on Saturday. Under the new
indirect tax regime, cement has been kept under the 28% tax slab, which is seen as a positive for the
industry.The current tax on cement, including value added tax and other local taxes, is 29-31% in different states. As such, the cost for cement companies would come down by 1-2%, which they might pass on to customers. Cement firms are also seen saving on logistics costs by having fewer and bigger warehouses, rather than many smaller warehouses in different states. As cement dealers don't keep high inventories of cement because of its limited shelf life, the new tax regime is not seen significantly affecting supply of the commodity. Monsoon is a weak season for cement. So, the affect of GST should not linger for long. Typically, the demand for cement falls during monsoon, as construction work almost comes to a standstill because of rains. Cement demand is expected to raise post monsoon and if any short-term disruption is caused by GST, it will settle by that time.
Source : Cogencis Information Services Ltd.
