Dalmia Bharat, JK Cement, HeidelbergCement gain up to 3%: What's driving gains?

Cement stocks in Wednesday's trade are on a roll with all of the stocks in the pack trading in the green. At the last count, Dalmia Bharat was up nearly 3 per cent, Heidelberg Cement up 2.64 per cent, JK Cement up 2.53 per cent and JK Lakshmi Cement up 2.6 per cent.

The gains are largely fuelled as cement prices in some of the regions were increased in the third quarter (September- December). Further, there is anticipated improved rural demand in the second half of the ongoing fiscal year on the back of a healthy Kharif output and improved farm prices.

Spending under additional houses in the PMAY scheme (rural and urban) and an increase in industrial and commercial Capex are also expected to drive cement demand in the near future, noted an Axis Securities report.

The government's budgeted capex outlay of Rs 11.1 lakh crore is also seen to offer impetus to the sector.

Jefferies on Cement

The global brokerage forecasts recovery for players in the segment in the 2HFY25 after cement prices have fallen to their lowest level. The sector saw subdued growth in October-November. Nonetheless, with the improvement in the government's capex, the sector is seen to draw benefit by the last quarter of the ongoing fiscal year.

Furthermore, the brokerage anticipates 8-10 per cent year-on-year (YoY) growth in volume uring the second half while it was steady in the first half.

Within the space, the brokerage has listed UltraTech Cement and JK Cement as its top picks.