All-India cement prices declined on a month on month (MoM) basis. Average prices were reported at Rs 312/bag during August from Rs 323/bag in July. After defying monsoon pressure during the previous month, prices finally declined during August due to lower demand on account of the monsoon season.
''The decline in prices is on expected lines due to monsoons. Average prices in the central region declined by Rs 4 /bag on an MoM basis to Rs 301/bag during August with a major decline in Ghaziabad and Indore where prices declined by Rs 6/bag and Rs 5/bag, respectively. In the southern region, the average decline in prices was by Rs 5/bag with a decline of Rs 10-12/bag in Bangalore, Chennai and Kochi while Hyderabad saw a defiant trend with a price increase of Rs 11/bag,'' said ICICIdirect.
''In the western region, prices in Gujarat declined by almost Rs 30/bag while Maharashtra also faced a price correction of Rs 6/bag to Rs 13/bag. With this, the average decline in the western region remained at Rs 16/bag with a price of Rs 325/bag. Northern and eastern regions registered a price decline of Rs 15/bag each MoM. Average price in the northern region stayed at Rs 284/bag post correction with highest decline in Jalandhar and Gurgaon,'' it said.
''Large cap stocks like Ambuja, UltraTech and Shree Cement have now reached their fair valuations after a sharp rally in the previous three months due to favourable election outcome. However, the midcap space has still potential for further upside from current levels. In the midcap space, we like the business fundamentals of JK Cement (doubling white cement capacity), JK Lakshmi Cement (strong presence in north) and Heidelberg (operating leverage and cost efficiency measures). In small caps, we still like Mangalam Cement after a sharp rally due to its attractive valuations,'' it opined.
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