BUDGET 2023 AHEAD : BULLISH TREND EXPECTED IN CEMENT SECTOR

BUY COROMANDEL FUT 2 LOTS ABOVE 894 TARGET 909/929 SL 874

BUY ULTRACEMECO FUT 2 LOTS ABOVE 7012 TARGET 7137/7229 SL 6912

Cement company stocks have rallied on the back of improving demand leading to price hikes and fall in input cost.On average, all-India cement prices have increased two per cent. The Eastern region, which has witnessed third consecutive hikes, saw an price increase of 4% last month, while the western region registered month-on-month rise of 2%. The southern and northern regions saw a moderate hike of one percent, even while it remained flat in the central regions. With a buoyant demand, cement companies are gearing up another price hike this month.
Driven by housing and infrastructure sectors, the cement industry has witnessed a V-shaped recovery and healthy growth in FY22, At 350 million tones, the demand surpassed pre-Covid levels of 331 MT in FY19 and is expected to grow by 8-9% y-o-y in FY23. Increased government spending on infrastructure and a pick-up in real estate is likely to support demand further. cement companies have raised the prices of their products on revival of demand as construction activities picked up post-monsoon and the Government‘s strong emphasis on housing and infrastructure spending prior to general election. Though the valuation of these stocks have gone up after the recent rally, it will be justified by the improved margins on the back of falling input cost.
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