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Apr-Jun 2013 Earnings Preview
Kamlesh Bagmar
kamleshbagmar@plindia.com
+91-22-6632 2237
Mandar Dhavle
mandardhavle@plindia.com
+91-22-6632 2258
Cement
Based on Economic Adviser’s (Ministry of Commerce and Industry) data, all-India
cement production grew 5.6% YoY at 44.9m tonnes during April-May2013. Our
interactions with companies suggest fall of ~5% YoY in June on the back of weak
demand and early monsoon. Hence, we expect all-India production to close the
quarter with growth of 4.2% at 65.7m tonnes.
Top picks
All‐India Cement Production
Shree Cement
75.0
70.0
65.0
60.0
55.0
50.0
45.0
40.0
35.0
30.0
Production in mn tonnes-LHS Growth (%)
16.0
14.0
12.0
10.0
8.0
6.0
4.0
2.0
0.0
Q1FY11
Q2FY11
Q3FY11
Q4FY11
Q1FY12
Q2FY12
Q3FY12
Q4FY12
Q1FY13
Q2FY13
Q3FY13
Q4FY13
Q1FY14E
Source: Economic Advisor to Ministry of Commerce & Industry
All-India cement prices fell 4.0% YoY and 1.0% QoQ at Rs295/bag in the quarter.
Western region posted the highest fall of 3.7% QoQ due to 7% fall in Gujarat’s prices
and flat prices in Maharashtra. Prices in North remained flat QoQ on account of
decent recovery in prices post fall in April. Prices in both East and Central region fell
1.9% QoQ each on account of high base and weak demand. Prices in the Southern
region remained flat, except AP, which posted an increase of 8% QoQ.
Average prices in the East up by Rs6/bag QoQ: West Bengal and Chhattisgarh were
the best performing states in the region, with an increase of Rs10/bag QoQ in Q1,
while, Orissa and Bihar lagged with a nominal increase of Rs3/bag QoQ. Hence, East
region’s average settled with an increase of Rs6/bag in the quarter.
Average up Rs5/bag QoQ in the North; Rajasthan posts lowest increase: Delhi
witnessed the highest increase in prices of Rs7/bag QoQ in the quarter. Prices in
Punjab and Haryana settled with an increase of Rs4 and Rs5 QoQ, respectively. Least
increase was witnessed in Rajasthan with an increase of Rs3/bag.
Prices in the Central region remained flat QoQ: Central remained flat QoQ with
disappointment from UP and MP, due to weak prices on account of weak demand
and increased supplies. Prices in UP rose by Rs2/bag QoQ, while, prices in MP fell by
Rs3/bag.
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