Stocks of cement companies have increased as a result of better demand driving up prices and lowering input costs. Cement prices across all of India have increased by 2% on average. Last month, prices increased by 4% in the Eastern region, where increases have already occurred three months in a row, and by 2% in the Western region. While it stayed flat in the centre areas, there was a little increase of 1% in the southern and northern regions. Cement manufacturers are preparing for another price increase this month due to the strong demand.
According to CARE Ratings, the cement industry experienced a V-shaped rebound and solid growth in FY22, driven by the housing and infrastructure sectors. “At 350 million tonnes, the demand exceeded the 331 MT pre-Covid levels in FY19, and it is anticipated that it will increase by 8 to 9 percent year over year in FY23. Demand is projected to be further supported by increased government spending on infrastructure and an uptick in real estate, it continued.
Shares of UltraTech Cement increased by 6% on Monday to $7,196 from $6,812 on November 1, while Shree Cement increased by 5% to reach $23,813 from $22,657 during the same period. JK Cement also increased to 3,190 ($2,800), while Ambuja Cement and ACC, both members of the Adani group, increased to $573 ($544) and $2,621 ($2,427).
However, some of these equities fell on Monday as investors booked profits. Additionally, cement producers increased the cost of their products in response to a recovery in demand as post-monsoon construction activity increased and the government’s strong emphasis on housing and infrastructure expenditure ahead of the general election. Although the valuation of these equities has increased during the most recent surge, he indicated that it will be supported by the better margins brought on by declining input costs. Due to a larger base, cement production in October decreased by 4% from the previous year. However, an analyst predicted that this month’s demand will increase due to pre-election development. Additionally, energy prices have been falling steadily for the past month, which is encouraging for cement industry participants.
