Cement Stocks Outlook for the week – 23 to 28.02.2015
( www.rupeedesk.in )
Stocks
of major cement companies during the extended trading week, in the run-up to
the Budget 2015-16 (Apr-Mar) announcement on Feb 28. Companies, as well as
market participants, are expecting the government to announce big push for the
infrastructure and housing sectors. Cement derives its demand from
infrastructure and housing activities.
The
cement sector expects fund allocation to increase towards infrastructure
projects such as
roads,
freight corridor, 100 smart cities, and housing for all, etc, which will boost
cement
demand.
The housing construction segment constitutes 65-67% of the total cement demand;
hence
allocating funds for schemes such as 100 smart cities and housing for all will
provide the much need boost to the cement demand.
The
industry is also expecting continuation of tax sops on housing loans, such as
Indira Awas
Yojana,
and reduction in excise duty structure from 12% now. General steps to pep-up
the
economy
such as continued focus on fiscal consolidation, shifting of expenditure from
non-plan to plan, and a sustained reform push, will also be positive for the
sector.
UltraTech,
which has expanded capacity by 50% in the last two years through organic and inorganic
expansion and likely to reach a 24% market share post consolidation of cement
assets of the BK Birla group.
