MUMBAI: Shares of cement companies were modestly in the green on price hike reports even as the Sensex fell over 270 points. According to reports, the prices have gone up by Rs 10-15 per bag in the western region.
“Channel checks indicate that cement prices have moved up sharply during last few weeks across India post monsoons. Average cement prices for the quarter till date stand at Rs 297 per bag as against Rs 287 per bag during Q2FY13. Recent price hikes take into account the cost pressures as well as price fall witnessed during first two months of the current quarter,” said Kotak Securities’ Private Client Research report.
According to analysts, in the near-term, demand may not last long due to lack of new projects in the infrastructure sector. However, recent deals in the cement sector indicate a positive long term outlook.
“Good monsoon during the quarter bodes well for boosting rural cement demand. We believe that any weakness owing to subdued Q2FY14 results provides a good opportunity to enter cement stocks with attractive valuations. Our top picks remains Grasim Industries and Shree Cement,” the report said.