Cement Jun sales growth robust; sluggish performance likely in Jul

[K.Karthik Raja]

Cement Jun sales growth robust; sluggish performance likely in Jul
Friday, Jul 4

MUMBAI - Frontline cement manufacturers reported a robust growth
in sales in
June on the back of good demand for the commodity amid construction
activity at
its peak.
However, the performance is likely to turn sluggish in July due to
a pause
in construction activity during monsoon, except in south India.
Cement makers have also tried not to create any inventory pile up
ahead of
monsoon, analysts said highlighting production and sales numbers for
June.
The strong performance in June is on the backdrop of weak sales
growth in
May, which was due to a ban on export impacting supply scenario in the
western
region where most of these companies have large exposure.
However, the ban, imposed in April, was eased on May 27 and cement
exports
through ports in Gujarat were allowed.
In June, Ambuja Cements Ltd was the top performer with sales at
1.47 mln tn,
up 6% from a year ago. Production during the month also rose 5% to
1.48 mln tn.
AV Birla group cement companies--Grasim Industries Ltd and
UltraTech Cement
Ltd--cumulatively sold 2.58 mln tn cement in June, up 5.2% from a year
ago.
Output for the month rose 1.9% to 2.55 mln tn.
ACC Ltd reported a 5.3% rise from a year ago in sales for June at
1.79 mln tn and 2.9% rise in output at 1.75 mln tn.
.
PRICE OUTLOOK
Prices of the commodity are likely to remain flat to weak for most
part of
July in western and northern region due to monsoon, stockists said.
However,
prices in south are likely to witness a firm trend, they said.
Wednesday, cement manufacturers hiked prices of the commodity by
3-5 rupees
per 50 kg in south India and prices are likely to rise 3 rupees more
next week.
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With the implemented hike, retail prices in Chennai stand at
272-275 rupees
per 50 kg bag, while wholesale and institutional category prices are
around 265
rupees.
In Hyderabad, cement will now cost 220-230 rupees per 50 kg across
segments.
According to media reports, cement makers may hike prices by 3
rupees per
50 kg in Maharashtra and Gujarat from Monday.
Even if cement makers hike prices next week for billing purposes,
revised
rates may not sustain, and discounts will be offered, dealers said.
Currently, cement wholesale prices in Mumbai are 255 rupees per
bag, while
retail prices are around 270 rupees. Institutions pay around 245
rupees for
50 kg of cement.
Prices in Ahmedabad, in the trade category, are 220-225 rupees,
while
institutional prices are 212 rupees.
In Kolkata, cement wholesale prices stand at 240-242 rupees a bag,
while
retail prices at 245-247 rupees, dealers said.
In the north, inventory level was low at around two days, while
retail
prices stood at 240-245 rupees in Delhi and 212 rupees in Jaipur.
Wholesale prices in Jaipur are around 207 rupees and 233-236
rupees per bag
in Delhi. End
.