Cement stocks surge as producers raise prices for September
Cement

Cement stocks surge as producers raise prices for September

Shares of cement companies witnessed a rally on Monday following price hikes for September ranging from 3% to 10% in east, west, and central India. Companies such as UltraTech Cement, ACC, Ambuja Cements, Shree Cements, Dalmia Bharat, Gujarat Ambuja Exports, Birla Corp, Ramco Cements, Nuvoco Vistas, ACC, and Ambuja Cements saw gains of 2% to 9% on the NSE.

While the September quarter is typically weak for cement producers due to reduced construction activity, strong demand in August, attributed to below-average monsoon rains, allowed companies to implement price increases this month. Cement prices have risen by ₹10-35 per 50kg bag, with the steepest hikes observed in eastern India, according to Jefferies. There's also potential for further price hikes in this region by mid-month, the brokerage noted.

Despite a 2% month-on-month decrease in the average cement prices in India to ₹358 per bag in August, prices remained relatively stable compared to the previous year, particularly in central and south India.

The market's response to these price hikes and the sustainability of these increases will be key factors impacting cement shares. The surge in cement company stocks is further supported by higher-than-usual trading volumes, with many reaching multi-month highs.

While robust demand is expected in the cement sector this year due to infrastructure and housing investments, the addition of incremental capacities by several cement producers may keep pricing competitive, experts caution. Lower fuel costs have also contributed to improved profitability, although the pricing trend will remain critical in the September quarter.

In addition to the positive momentum in the cement industry, Shree Cements received a boost after Nomura Financial upgraded its rating on the company's shares from 'reduce' to 'buy,' setting a target price of ₹28,700."

Shares of cement companies witnessed a rally on Monday following price hikes for September ranging from 3% to 10% in east, west, and central India. Companies such as UltraTech Cement, ACC, Ambuja Cements, Shree Cements, Dalmia Bharat, Gujarat Ambuja Exports, Birla Corp, Ramco Cements, Nuvoco Vistas, ACC, and Ambuja Cements saw gains of 2% to 9% on the NSE.While the September quarter is typically weak for cement producers due to reduced construction activity, strong demand in August, attributed to below-average monsoon rains, allowed companies to implement price increases this month. Cement prices have risen by ₹10-35 per 50kg bag, with the steepest hikes observed in eastern India, according to Jefferies. There's also potential for further price hikes in this region by mid-month, the brokerage noted.Despite a 2% month-on-month decrease in the average cement prices in India to ₹358 per bag in August, prices remained relatively stable compared to the previous year, particularly in central and south India.The market's response to these price hikes and the sustainability of these increases will be key factors impacting cement shares. The surge in cement company stocks is further supported by higher-than-usual trading volumes, with many reaching multi-month highs.While robust demand is expected in the cement sector this year due to infrastructure and housing investments, the addition of incremental capacities by several cement producers may keep pricing competitive, experts caution. Lower fuel costs have also contributed to improved profitability, although the pricing trend will remain critical in the September quarter.In addition to the positive momentum in the cement industry, Shree Cements received a boost after Nomura Financial upgraded its rating on the company's shares from 'reduce' to 'buy,' setting a target price of ₹28,700.

Next Story
Equipment

Handling concrete better

Efficiently handling the transportation and placement of concrete is essential to help maintain the quality of construction, meet project timelines by minimising downtimes, and reduce costs – by 5 to 15 per cent, according to Sandeep Jain, Director, Arkade Developers. CW explores what the efficient handling of concrete entails.Select wellFirst, a word on choosing the right equipment, such as a mixer with a capacity aligned to the volume required onsite, from Vaibhav Kulkarni, Concrete Expert. “An overly large mixer will increase the idle time (and cost), while one that ..

Next Story
Real Estate

Elevated floors!

Raised access flooring, also called false flooring, is a less common interiors feature than false ceilings, but it has as many uses – if not more.A raised floor is a modular panel installed above the structural floor. The space beneath the raised flooring is typically used to accommodate utilities such as electrical cables, plumbing and HVAC systems. And so, raised flooring is usually associated with buildings with heavy cabling and precise air distribution needs, such as data centres.That said, CW interacted with designers and architects and discovered that false flooring can come in handy ..

Next Story
Infrastructure Urban

The Variation Challenge

A variation or change in scope clause is defined in construction contracts to take care of situations arising from change in the defined scope of work. Such changes may arise due to factors such as additions or deletions in the scope of work, modifications in the type, grade or specifications of materials, alterations in specifications or drawings, and acts or omissions of other contractors. Further, ineffective planning, inadequate investigations or surveys and requests from the employer or those within the project’s area of influence can contribute to changes in the scope of work. Ext..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?