More Stories

Informist, Friday, Jul 26, 2024

MUMBAI - Shares of cement companies are expected to extend gains, but these gains will likely be limited as concerns about the valuations and cement prices may likely weigh, analysts said. Investors will await a slew of June quarter earnings from the cement companies, which are expected to be weak owing to price cuts and the General Elections.

However, in the long term, the demand is seen as robust in the sector, which is also supported by the Budget wherein the infrastructure-related capital expenditure showed policy continuity. There is consolidation in the sector, which will likely continue as smaller players will struggle to sustain, Jainam Shah, equity research associate at IndSec Securities, said. 

Talking about the Apr-Jun earnings expectations, Shah said the realisations were weak. Further, the quarter is considered as weak for cement companies due to seasonality.

Ambuja Cements, ACC, and JK Lakshi Cement are slated to announce their quarterly earnings in the upcoming week. Ambuja Cements is likely to report a minor drop of 0.2% on year in its standalone net sales for the June quarter at 47.2 bln rupees. The company's revenue for Jan-Mar was 47.8 bln rupees, while the net profit for the same period was 5.3 bln rupees. On a sequential basis, weak prices of cement could impact the company's operating margins.

Like its peers, ACC is expected to take a hit on its June quarter earnings from a drop in demand due to the General Elections in the country and softer cement prices. ACC's consolidated net sales for Apr-Jun are likely to fall 3.2% on year and 6.9% on quarter to 50.35 bln rupees. The consolidated net profit is likely to fall 9.83% on year and 55.51% on quarter to 4.2 bln rupees.

TOP HEADLINES
* Earnings Outlook: ACC's sales growth, margins may slow in Apr-Jun
* Earnings Outlook: Grasim net profit seen dn 57% YoY, revenue up 17%
* JK Cement Apr-Jun net profit surges 60% on year as expenses down
* Earnings Review: UltraTech Apr-Jun PAT growth weak as realisation dn
* UltraTech Apr-Jun consol PAT misses view on lower realisation

Following are the resistance and support levels for the sector's key stocks for next week, as per calculations based on their prices on the National Stock Exchange:

End

Reported by Anjali Singh
Edited by Manisha Baxla

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000
Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2024. All rights reserved.