Cement Stocks Outlook for the week – 15 to 19.06.2015
(Expect
pullback in stocks of cement companies next week)
( www.rupeedesk.in )
We
expect pullback in stocks of cement companies next week. Cement stocks have
been in the correction mode since the announcement of union budget because of
lower demand and declining prices.
There
was too much euphoria about demand and price of cement ahead of Union Budget
presentation,
on hopes that boost to the infrastructure (sector) would lead to higher demand.
Cement stocks had seen major rise during that time. They have corrected since
then.
Among
all the stocks, we are positive about stocks of UltraTech Cement Ltd because of
its capacity and volume growth. "UltraTech Cement is focusing on the
business. Acquisition of Jaypee Group's two units augur well for the company in
future. The proposed merger of it with Century Textiles Ltd will further expand
its capacity, making it stronger. The company's balance sheet has also shown growth
on a sequential basis.
Stocks
of major cement companies are likely to remain under pressure next week in
absence of government spending on infrastructure projects. On ground, nothing
has happened. Companies are still struggling to stimulate the demand for
building material. It will take around another three to four months for
government proposals to materialise.
