Outlook for Cement companies remains strong; analysts bullish about sector

Three top players, UltraTech, Ambuja and ACC post a robust performance in June quarter

Cement shares appear to be in a strong bull-run. The share prices of the cement majors have comfortably outrun the Nifty over the past month and over the past year as well. The industry’s fortunes are linked to activity in the realty industry and to construction, in more general terms.

Since construction is mainly driven by infrastructure activity, this is a key factor. The 2021-22 Budget has a strong infrastructure focus and, despite the lockdowns, project activity is up. The industry has a natural defence against imports because cement is hard to transport by sea.

The year-on-year (YoY) results of