Cement - Weak demand weighs on cement prices - Emkay

- All India prices at Rs289/bag, -3.4% mom, decline led by sluggish oftake due to festive season- Weaker than estimated demand scenario results in a steeper fall

- Central & Northern regions witness steep decline in prices of -5.5% & -5.3% respectively followed by East -3.7% and West -2.6%.Prices in the southern region remained flat vs expectation of further bounceback in AP

- However cyclone Nilam impacted Andhra Pradesh demand restricting bounce back of prices ; strike in Kerela by the dealer association disrupts the demand scenario in the region

- Demand now remains a key driver as it has finally started weighing down on prices & any hikes expected in Dec & Jan would have to be supported by a healthy demand growth

- Prefer ACC as steep valuations leave little room for further out-performance for Ambuja & Ultratech. Remain positive on Grasim, Shree Cements and Madras Cements

Source : Equity Bulls

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