Cement stocks gain traction in today’s trade; surge up to 5% in past one month

Shares of cement companies were in focus today (May 28, 2024) as analysts forecast an impact on premium valuation of large players in the industry.

At the time of writing this copy, shares of cement companies traded mixed, with UltraTech Cement up by over 1 per cent at Rs 10334.35, Shree Cement up 0.82 per cent at Rs 25,600 and Ambuja Cements up 0.14 per cent at Rs 633.25. Meanwhile, other notable player ACC traded with a marginal drag at Rs 2,582.6 per share. 

In the March quarter, on the back of aggressive volume push which led to a sharp increase in volume to the tune of 7-22 per cent at large cement companies, cement prices declined by a steep 5.1 per cent sequentially on an average to Rs 359 per 50 kg bag.

Also, in the past one year, coal and pet coke prices have come down by 25-50 per cent. Coal and pet coke are the major input cost constituents and the reduction in their prices bodes well for Indian cement manufacturers.

In the past one month, cement stocks have surged up to 5 per cent, with Shree Cement taking the lead. All the below listed companies command an overall 55 per cent market share

Stocks                  1-month return 
Ultratech          +4.44%
ACC                 +1.84%
Ambuja Cem    -1.32%,
Shree Cement  +5%

Outlook 

Analysts expect the industry to see sharp recovery in demand post Lok Sabha polls 2024.