December 17, 2012 / 8:29 AM / 5 years ago

Government measures to boost cement demand

Reuters Market Eye - India’s cement industry will witness a sharp recovery in cement prices in fiscal 2013-14, on improving supply-demand dynamics and the government action to fast track infrastructure projects, analysts say.

Deutsche Bank believes cement companies such as UltraTech Cement(ULTC.NS) and Shree Cement (SHCM.NS) that have potential to increase capacity and have a bigger presence in western and northern India will witness “disproportionate benefits”.

Bank of America Merrill Lynch upgrades Ultratech Cement and India Cements (ICMN.NS) to ‘buy’ from ‘underperform’ in reports dated on Friday.

Morgan Stanley maintains an ‘attractive’ view on the sector, and recommends investors to buy cement stocks on weakness because on expectations of easing capacity addition and pickup in cement demand, in a report dated Friday.

Mid-cap cement companies outperform large caps: India Cements (ICMN.NS) gains 0.7 percent, JK Cement (JKCE.NS) is up 1 percent while Madras Cement MSCM.NS rises 1.8 percent.

    Ultratech Cement shares are down 1.2 percent, ACC (ACC.NS) gains 0.1 percent.

    The Thomson Reuters construction materials index down 0.08 percent as of 1.25 pm.

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