As cement shares climb, UltraTech Cement's market capitalization surpasses Rs 3 lakh crore

As cement shares climb, UltraTech Cement's market capitalization surpasses Rs 3 lakh crore

As cement shares climb, UltraTech Cement's market capitalization surpasses Rs 3 lakh crore

In H1FY24, the cement sector in India had robust volume growth of 17% year over year. According to Nomura, the momentum is anticipated to carry over into the second half, with sales volume predicted to rise by 13% year over year and by 11% from the first half.

UltraTech Cement was downgraded from 'neutral' to 'buy' by the brokerage company. The stock's target price has been established at Rs 11,500.

For the first time, UltraTech Cement's market capitalization surpassed Rs 3 lakh crore amid the surge in cement equities. As a result, the firm that makes cement is now the 20th biggest in India. Additionally, it was the day's top gainer among the Nifty 50.

On December 27, cement stocks rose sharply after Nomura upgraded them, citing solid increase in sales volumes, improved price discipline, and progress toward valuation by FY2016.

UltraTech Cement's market capitalization increased to Rs 3.01 lakh billion, up more than 4%, to Rs 10,453. UltraTech Cement was downgraded from 'neutral' to 'buy' by the brokerage company. It has established a target price for the stock of Rs 11,500.

In H1FY24, the Indian cement sector had a robust volume rise of 17% year over year. According to Nomura, the momentum is anticipated to carry over into the second half, with sales volume predicted to rise by 13% year over year and by 11% from the first half.

The broker increased its previous estimate of industry volume growth for FY2024 from 8% to 12%.

In our opinion, FY20 cement demand will be muted since the nation typically experiences a slowdown in the start of infrastructure projects during a general election year. However, given the central government's ongoing focus on infrastructure, sustained demand from inexpensive and rural housing, and the boom in urban housing, demand should continue to be stronger than the previous 10-year CAGR of 4%. Nomura said in its report that although there are downside risks due to poor rural demand, we forecast a 5% CAGR in cement demand during FY 2024–2026.