Path still unclear for cement stocks amid subdued pricing, weak demand

While capital expenditure by government should aid demand in March quarter, a meaningful demand revival is unlikely anytime soon

Investors have shied away from cement stocks in the past six months due to subdued pricing amid weak demand. The trend is unlikely to reverse soon.

Since July 2019, stocks of major cement companies, such as UltraTech Cement, ACC, and Ambuja Cement, among others, are down to 9 per cent in an otherwise bullish market (the BSE Sensex was up 4 per cent). Even Shree Cement is down by over 3 per cent.

Though recent ground-check reports by analysts offer some hope on cement pricing, sustaining the gains may not be easy.

Consider this: While average cement prices in December