Northern region sweet spot for cement firms

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Published: September 19, 2019 2:15:16 AM

Based on regional analysis of demand supply scenario, clinker shortage and likely cement consumption from key governments projects helping different regions, it has been found that northern region more preferred, and current tailwinds are likely to sustain.

Cement Sector, Cement Stocks, infrastructure project, northern region, cement demand, cement pricing growth,cement price, cement  rate, cement industry in india, cement industry Companies which have focus on this region are expected to do well compared to peers in other regions, said an analyst with Reliance Securities.

Northern region has been better positioned and is in a sweet spot as far as cement sector is concerned. Rising consumption, steady pricing, increasing infra spend by states will make it a preffered one with a clear edge over other regions, said analysts tracking the industry.

Based on regional analysis of demand supply scenario, clinker shortage and likely cement consumption from key governments projects helping different regions, it has been found that northern region more preferred, and current tailwinds are likely to sustain. Companies which have focus on this region are expected to do well compared to peers in other regions, said an analyst with Reliance Securities.

“As we continue to maintain our structural positive view on cement industry from a long-term perspective, we believe northern region as of now is in a sweet spot and is likely to remain as preferred region with having an edge over other regions mainly led by favourable demand and supply outlook; best pricing discipline aided by clinker constraints; healthy pipeline of infrastructure projects and and relatively being less fragmented, the analyst said.

An analyst with Motilal Oswal said, players in the northern region are significantly better positioned with a much lower drop in margins v/s players in the south and the east.

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