Know which is the best performing stock in cement sector!

Know which is the best performing stock in cement sector!

by 5paisa Research Team Last Updated: 2022-04-13T13:25:33+05:30

Four stocks have delivered a staggering return of over 20% and twelve stocks have delivered gains of over 10%.

Since the Nifty has hit a high of 18,114.65 in the early part of April month, the trend of the market has been wobbly. Despite the trend of the headline indices being wobbly, one sector where the has been crystal clear is the Cement and Building Material sector.

The stocks from Cement and Building Material sector started their upward journey in March and still some of the stocks are seen continuing their uptrend trend. However, this upward move has come after a period of lull, as stocks from this sector have not managed to deliver handsome returns for their shareholders.

Interestingly, on checking the data, we found that out of 27 stocks from this sector, none has delivered a negative return from the period beginning of March 2022 to date. Four stocks have delivered a staggering return of over 20% and twelve stocks have delivered gains of over 10%. The top gainer in the list is Ambuja Cements, which jumped nearly 29% since March 2022 followed by Jai Prakash Associates, Sagar Cements and JK Cement which have gained about 26%, 25% and 22%, respectively.

So, what has been a trigger for the rally in this sector?

To being with, reports from media indicate that the cement makers have taken a price hike. Before they were reeling under the impact of higher input costs and to mitigate the rising input pressure, they decided to pass on some portion of this to the consumers.

The interesting part here is that once the hikes are in place, the price stabilizes at a certain level and it does not really cool off considerably. While on the other hand, the input cost may sooner or later cool off as there is a war premium built into cost right now, hence, this would result in stable margins in the medium to longer term. Secondly, the cement demand improved in most markets in the month of March after remaining sluggish in the latter part of the last year.


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