InvestorQ : Cement stocks like ACC, Ambuja, Ultratech and Shree have gone up since lockdown easing last month. Do you see the rally sustaining?
Moii Chavate made post

Cement stocks like ACC, Ambuja, Ultratech and Shree have gone up since lockdown easing last month. Do you see the rally sustaining?

Answer
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Sam Eswaran answered.
4 months ago


Most cement companies have seen sharp rallies in the last few weeks after resumption of production in these companies. What is driving this optimism? Most investors have been surprised by the consistent increase in cement prices in May. In fact, cement prices are up by Rs.20-30/bag in the North, Central and West markets; Rs.20-50/bag in the East markets and Rs.40-90/bag in the South region. Most analysts are betting on a spike in cement demand and prices after the lockdown on the back of pent-up demand. Stalled projects in housing and infrastructure need to be completed and that will boost cement demand. Most cement companies are operating at 65% capacity utilization but have expressed confidence in ramping this up to 85% in a short time. So supply should not be a problem. Of course, the large scale migration would be a constraint but factory supervisors expect most of them to come back as other states do not have enough work opportunities.