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Informist, Friday, Oct 25, 2024

MUMBAI – Shares of cement companies may continue to see muted movement next week in the absence of major domestic triggers and amid expectations of further weakness to continue in the overall equity market, analysts at two broking firms said. While these stocks may continue to be weak in the short term, some analysts see a recovery in demand as construction and housing activities are expected to pick up after the monsoon, which could push stock prices higher in the medium-to-long term. 

When it comes to the September quarter earnings, cement companies are most likely to post an on-year fall in earnings growth and could be an outlier compared to other sectors in India. The weak earnings growth could be attributed to the fall in cement prices, lower volume, and softer demand during the monsoon, analysts tracking the sector said. 

Ambuja Cements is scheduled to release its quarterly results Monday. The cement maker's net profit for Jul-Sept is expected to fall over 51% on year to INR 3.87 billion and revenue is seen declining 15.3% to INR 62.89 billion, according to the average of estimates from seven brokerage houses. This poor performance could be due to lower prices of cement and extended unseasonal rains in many parts of the country, and a delay in allocation of funds for infrastructure-related projects post the General Election, broking firms said in their earnings preview reports. Shares of the company closed 1.1% lower at INR 552.70 on the National Stock Exchange Friday and fell 3.7% from the previous week. 

TOP HEADLINES
* Dalmia Bharat to buy 5.4% stake in Atria Wind Power for INR 34.79 mln
* Earnings Review: Volume growth lifts ACC's consol revenue for Jul-Sept
* Four brokerages cut UltraTech Cement share price target post Jul-Sept result
* Ambuja Cements to buy Orient Cement at INR 81 billion equity value
* Analyst Concall: Demand key, keeping a sharp eye on it - Ultratech's mgmt
* Earnings Review: UltraTech Jul-Sept PAT tanks 36% on year to INR 8.2 bln
* Dalmia Bharat Jul-Sept consol net profit falls 61% on year, sales down 2.1%

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 Anjana Therese Antony
Edited by Tanima Banerjee

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