Cement stocks can be a favorable if one can play cyclical rightly. Given the government’s focus on infrastructure spending and affordable housing, the
cement sector’s long-term growth potential continues to remain healthy. Demand revival is imminent, especially during the festive season and the January-March peak construction period.
The second quarter is traditionally a weak one for the cement sector, with lower demand as construction activity slows down on account of the monsoons.
Demand was low during July and August 2022, showing some sign of revival in September, 2022. Pick-up in retail demand was on the back of pent-up demand accumulation during the monsoons, pre-Diwali construction and repair work gaining momentum, and pre-election tailwinds. Institutional demand was led by increased construction activity after the receding monsoons.
Any downside post Q2 can be taken as calculative opportunity if correction is solely due to lower Q2 demand.
| Subscribe To Our Free Newsletter |
