Motilal Oswal Top Picks From Cement Sector: Buy, Sell, Neutral Call To 11 Stocks
Leading brokerage firm Motilal Oswal has initiated coverage on stocks from cement sector.
These stocks are Ultra Tech Cement, Shree Cements, Ambuja Cements, ACC Ltd, Dalmia Bharat, The Ramco Cements Ltd, JK Cement, Birla Corporation Ltd, India Cements, JK Lakshmi Cement, and Grasim Industries.
The analyst has assigned buy, neutral, and sell call to these stocks.
3 QFY 23; we believe cement demand recovered strongly over the quarter.
We estimate 10% YoY volume growth in 3 QFY 23 ( three- year CAGR at 5 .4%), aided by strong infrastructure and real estate demand as well as the low base effect of last year.
2. Cement Prices Should Remain Strong In 4 Q FY 23 E
4 QFY 20 was hit by Covid-19 as restrictions were imposed in Mar' 20).
3. Cost Pressures Appear To Be Subsiding
cement companies' OPM witnessed a sharp contraction over the past one year due to elevated fuel prices.
OPM for our coverage universe was at a record low of ~ 10 % in 3 QFY 23 mainly fueled by ~ 42 % YoY increase in variable cost/ t.
Average EBITDA/ t of our coverage universe, at INR 657, was at a 35- quarter low in 2 QFY 23
4. Profits Likely To Improve
UTCEM is our top pick in the largecap space. We prefer DALBHARA and JKCE in the midcap space the. and the
Disclaimer
The stocks have been picked from the brokerage report of Motilal Oswal.
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By Renu Baliyan Goodreturns source: goodreturns.in Dailyhunt