Shares cement manufacturing companies are under pressure in opening trades ahead of Competition Commission of India (CCI) order accusing top cement companies of creating a cartel.
“Top 11 companies by revenue are likely to face penal action, of 8% of their average sales in the past three years, which might cost the cement makers 40-60% of their net profits for the latest accounting year,” the reports suggests.
The competition watchdog may slap a fine of about Rs 3,000 crore on top cement companies, ruling them guilty of forming a cartel and fixing prices.
If the order goes through, UltraTech Cement, Ambuja Cements and ACC, which control a third of the volumes in India, are likely to be impacted the most. Jaypee Cements, India Cements and Madras Cements, too, are expected to face action, added report.
Among the individual stocks, Ambuja Cements, ACC, UltraTech Cement, Grasim Industries, India Cements and Madras Cements are trading lower by 1-5% in opening trades on the Bombay Stock Exchange.