Despite good demand cement prices to stay down until mid-year
Cement

Despite good demand cement prices to stay down until mid-year

Prabhudas Lilladher, anticipates an 8-9% growth in cement sector volumes from April to March 2024-25, followed by over 10% growth the following year. However, prices are expected to remain subdued until after the monsoon season.

Tushar Chaudhari, a Research Analyst at the brokerage firm, holds a positive outlook on large-cap cement companies such as UltraTech Cement and Ambuja Cements.

Chaudhari highlights the aggressive strategies and cost efficiencies of these companies, along with capacity expansions to meet rising demand. He expects them to secure a significant market share in the future, although smaller companies may struggle unless demand and pricing improve further.

While UltraTech shares have seen a year-to-date decline of over 2%, Ambuja has experienced a gain of more than 16%.

Demand for cement has been gradually improving, with a rebound in growth seen in February and March after a weak January due to weather conditions and pollution-related restrictions.

Despite attempts to raise prices in April and May, weak demand led to price reductions. Although some regions, particularly in the North and Central areas, saw slight price increases of Rs 5-10, an overall weakness persists.

Post-monsoon, as demand picks up significantly as companies are expected to resume price hikes.

The EBITDA per tonne are forecasted to improve by the second half of FY25 to over Rs 1,000 for most leading companies.

South-based companies like Ramco Cement and Sagar Cements are also to benefit from recent political developments, with the Telugu Desam Party (TDP) pledging to reinstate Amaravati as the capital city.

Brokerage firm Jefferies predicts a potential price hike for June following the conclusion of elections. The expected impact of weak prices and volume on EBITDA per tonne in the first quarter is said to be partially offset by lower variable costs.

(Source: CNBCTV18)

Prabhudas Lilladher, anticipates an 8-9% growth in cement sector volumes from April to March 2024-25, followed by over 10% growth the following year. However, prices are expected to remain subdued until after the monsoon season. Tushar Chaudhari, a Research Analyst at the brokerage firm, holds a positive outlook on large-cap cement companies such as UltraTech Cement and Ambuja Cements. Chaudhari highlights the aggressive strategies and cost efficiencies of these companies, along with capacity expansions to meet rising demand. He expects them to secure a significant market share in the future, although smaller companies may struggle unless demand and pricing improve further. While UltraTech shares have seen a year-to-date decline of over 2%, Ambuja has experienced a gain of more than 16%. Demand for cement has been gradually improving, with a rebound in growth seen in February and March after a weak January due to weather conditions and pollution-related restrictions. Despite attempts to raise prices in April and May, weak demand led to price reductions. Although some regions, particularly in the North and Central areas, saw slight price increases of Rs 5-10, an overall weakness persists. Post-monsoon, as demand picks up significantly as companies are expected to resume price hikes. The EBITDA per tonne are forecasted to improve by the second half of FY25 to over Rs 1,000 for most leading companies. South-based companies like Ramco Cement and Sagar Cements are also to benefit from recent political developments, with the Telugu Desam Party (TDP) pledging to reinstate Amaravati as the capital city. Brokerage firm Jefferies predicts a potential price hike for June following the conclusion of elections. The expected impact of weak prices and volume on EBITDA per tonne in the first quarter is said to be partially offset by lower variable costs. (Source: CNBCTV18)

Next Story
Infrastructure Energy

Centre suggests states to list power firms

Power Minister Manohar Lal urged states and union territories to consider listing their power generation, transmission, and distribution companies on stock exchanges to attract investment and improve operational efficiency. Addressing the media, after a conference of power ministers, Lal highlighted the need for increased capital inflows to meet India’s rising power demand, which has placed added strain on the sector. “With the growing power demand, there is a growing need for investment in the sector and improving operational efficiencies. States may identify and take up utilities for lis..

Next Story
Infrastructure Transport

Metro on backburner as Tricity set to get new e-buses circuit

To boost connectivity for the commuters of the Tricity, a new circuit-cum-network of electric buses (e-buses) is all set to come up that will cover Chandigarh, Panchkula, and Mohali. The move comes days after Union Minister for Housing and Urban Affairs Manohar Lal Khattar said that in Chandigarh the ridership is not according to the criteria set for operating a Metro. He had also said that the option of a pod taxi can also be explored as it will not impact the heritage of the Union Territory (UT).Officials stated that the e-buses decision intends to provide an eco-friendly public transportati..

Next Story
Infrastructure Energy

Rajasthan government plans to develop hi-tech city near Jaipur

On the lines of Gujarat International Finance Tech (GIFT) City and Hyderabad Information Technology and Engineering Consultancy (HITEC) City, Raj govt is gearing up to develop a "hi-tech city" close to Jaipur. Recently, Boston Consulting Group – a multinational consulting firm – gave a presentation on the concept of hi-tech cities, follwing which the state govt has started looking for suitable land on outskirts of Jaipur. "We are going to construct a hi-tech city on the outskirts of Jaipur. We are trying to ascertain the amount of land required for core areas of the city and for areas wh..

Hi There!

"Now get regular updates from CW Magazine on WhatsApp!

Join the CW WhatsApp channel for the latest news, industry events, expert insights, and project updates from the construction and infrastructure industry.

Click the link below to join"

+91 81086 03000