Cement stocks may cool a bit

Stocks of cement companies may come under pressure this week as prices have fallen about Rs 15-20 for a 50-kg bag last week in Karnataka, Maharashtra and Tamil Nadu. The slide was quite sharp in Andhra Pradesh: a 50-kg bag has lost between Rs 20 and Rs 25 to hover around Rs 270-275 a bag. Sudden excess capacity created in the market with the launch of new brands — Jaypee Cements, JSW, Jaya Jyothi and Bhavya and slackening of demand seemed to have impacted the price. With August-September normally considered lean months for cement, the price may fall even further going ahead. Particularly, southern-based companies’ stocks such as India Cements, Sagar Cements, Andhra Cements, Deccan Cements and Madras Cements will be under watch.

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