The Hindu Business Line : Cement scrips up on good outlook

There was active buying seen on Thursday in several companies. The stocks that rose included ACC (up 2.86 per cent at Rs 473 on BSE); India Cement (10.61 per cent at Rs 103.25); Mangalam Cement (5.75 per cent at Rs 83.75); Prism Cement (7.17 per cent at Rs 25.40); and JK Cement (4.17 per cent at Rs 128.60).

The main factor for the rise in the stock price of these companies is that the cement demand in the country has risen by more than 7 per cent in the last three years, while no fresh large capacity has been added in the sector during this period.

Capacity utilisation by most of these companies has also risen. The talk is that with demand for cement likely to remain robust, it may result in better capacity utilisation. Dealers said with no additional capacity likely to come up in the next few years, cement prices are likely to go up. Moreover, traders are now looking at replacement cost of a cement plant to value most of these companies. Several broking firms have put `buy' on the cement sector companies due to these factors.

Voltas: Growth prospects to the fore

SHARES of Voltas, an engineering company and part of the Tata group, have been on an upward move in the last few days. On Thursday, the stock rose 8.4 per cent at Rs 341.50 on the BSE with volumes of 1.45 lakh shares and, on the NSE, it closed at Rs 340.25, up 8.2 per cent with volumes of 2.40 lakh shares.

Dealers said the activity in the stock is due to interest of select FIIs in the counter.

The buzz isthat there is continuous buying in the counter this week. A leading foreign broking firm has also come out with a buy report on the stock this week. This firm is bullish on the stock due to the growth in the company's project business with big orders from the Gulf countries.

Its agency business that involves sectors such as textiles, mining and other industries too is doing well. This business is the most profitable one for the company. This firm expects 50 per cent growth annually in the company's profits in the next three years.

Virendra Verma

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