Shares of cement companies soared on Thursday, as a spate of news made several counters hit 52-week highs.
Robust sales from cement majors ACC, Ambuja and Jaiprakash Associates in January, coupled with a price increase, benefited the counters. Also, Coal India rolled back a recent price increase. Industry officials say the new pricing mechanism from Coal India, now withdrawn, would have made cement costlier by Rs 4 a bag.
Companies witnessed their stocks gain between three and seven per cent on a day when benchmark indices were up less than a percentage point. Kanpur-based JK Cement gained the most, rising 6.3 per cent to close at Rs 122.50. ACC hit a 52-week high at Rs 1,259.95, up five per cent.
| SURGING ON FIRM FOUNDATION Share price on BSE in Rs | ||
| Company | Closing price | Chg (%) |
| JK Cement | 122.50 | 6.34 |
| ACC | 1259.95 | 4.94 |
| Madras Cement | 125.05 | 4.60 |
| India Cements | 87.75 | 4.46 |
| Ambuja | 169.70 | 3.32 |
| UltraTech | 1263.20 | 2.10 |
| % change over previous close | ||
ACC and Ambuja Cements, both owned by Swiss major Holcim, reported a decent rise in sales. ACC sold 8.25 per cent more cement at 2.23 million tonnes in January, against 2.06 mt in the corresponding month last year. Ambuja posted a 4.1 per cent rise in despatches at 1.91 mr, compared with 1.84 mt last year. UltraTech Cement, part of the Aditya Birla Group, sold 11 per cent more at 3.7 mt during the month. Jaiprakash Associates had a 27 per cent rise in sales at 1.9 mt against 1.5 mt last January.
Amid these higher despatches, reports suggest the companies increased prices by Rs 6-8 for a 50-kg bag.
Since November, the industry has been on a high growth trajectory. Till December, the growth was 5.3 per cent; this is likely to go up to 6.5 per cent if the January-March period continues to sustain the double-digit growth.
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This year so far, shares of major cement companies have gained between eight and 41 per cent. UltraTech touched a 52-week high in January and has gained close to nine per cent in the year to date.
ACC gained 11 per cent; JK Cement and Madras Cements gained 22 per cent each. India Cements’ stocks has rallied 33 per cent so far this year and Jaiprakash Associates hasgained 41 per cent.