The Hindu Business Line : Realty boom drives up ceramic, tile firms' stocks

"Till recently, the tiles industry had large number of small players and almost 95 per cent was considered to be in the unorganised sector. The overall growth prospects in the realty industry have witnessed the emergence of the organised sector," said Mr B.G. Borkar, CFO and Company Secretary, Nitco Group.

The Group-owned Nitco Tiles is into capacity expansion and has come out with a range of premium floor and wall tiles.

Nitco Tiles traded at Rs 210.90, down by 0.75 per cent, on the BSE on Friday.

Other biggies in the sector, such as Murudeshwar Ceramics Ltd, Kajaria Ceramics Ltd and Orient Ceramics, are faring well on the bourses.

In addition to stretching its product line, Murudeshwar Ceramics is planning to expand its vitrified tiles segment from 26,000 sq. m per day to 32,000 sq. m per day.

The company's shares traded at Rs 100.75, up by 4.95 per cent, on the BSE on Friday.

Orient Ceramics is mulling over expansion of its product lines by adding more designs and premium variants. "The boom in construction sector will last for another five years and will spread to smaller cities and towns.

"Exports to countries like Sri Lanka, the Gulf and South Africa are also doing well. The sector is expected to grow 14 - 20 per cent every year for the next five years," said Mr Sanjay Monga, Vice-President - Sales and Marketing, Orient Ceramics.

Orient traded at Rs 95.50, down 1.55 per cent on the bourses. The stock prices has appreciated 15.76 per cent month-on-month.

The shares of Kajaria Ceramics, Spartek Ceramics and Bell Ceramics have moved up 11.55 per cent, 17.29 per cent and 10.48 per cent, respectively, over the month.

"The sector is doing well with the spurt in commercial construction and real estate initiatives. A clear indication to this effect is the amazing turnaround of these stocks, which were badly hit by the slump in the markets. Some stocks in the sector are definitely good holds," said Mr Arun Agarwal of Karvy Stock Broking. The biggest player in the organised sector H&R Johnson is not listed.