Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
September dispatches remain muted…
Cement majors report ~3% YoY growth in dispatches, decline ~5% MoM
In September 2011, the major cement players reported an aggregate
dispatch growth of 3.4% YoY. However, the companies have shown a
mixed performance. ACC reported 9.5% YoY growth in dispatches during
the month on account of Chanda capacity expansion, Jaypee reported
~17% YoY growth in dispatches, Ambuja Cement reported muted ~3%
YoY growth while UltraTech reported ~2% YoY decline and Shree
cement reported ~9% YoY decline in dispatches.
On an MoM basis, UltraTech, ACC and Shree Cement reported ~8-14%
decline in dispatches while Ambuja and Jaypee reported muted ~2-3%
growth in dispatches. The dispatches were lower on a sequential basis on
account of a slowdown in construction activities due to monsoons.
In August 2011, overall industry dispatches grew ~6% YoY while it has
declined ~6% on an MoM basis as the offtakes were impacted by a
slowdown in construction activities due to monsoons.
All-India average cement price picked up by | 10 per bag MoM in Sep ‘11
All-India average cement price have increased by ~| 5-20 per bag in
September 2011 across all regions (except south). This price increase
happened after the correction of ~| 40 per bag during May-August 2011.
The recovery in cement prices is due to expectations of pick up in cement
demand as the monsoon ends. In the north and central region, prices
have increased by ~| 10-20 per bag MoM while prices have sustained in
the southern region and remained flat MoM. We expect cement prices to
recover further in October 2011 on account of a pick-up in dispatches.
Industry outlook
[
We expect all-India cement consumption to remain muted and likely to
grow by ~6% YoY in FY12E as against long term average growth of ~9%
CAGR. Muted demand is mainly on account of key issues like rising cost
of capital, slowdown in government projects, delay in construction
activities due to issues in land acquisition & clearances, political
uncertainty in Andhra Pradesh and unavailability of key raw materials. The
utilisation rate is expected to decline to 76% in FY12E as the incremental
demand of 12.5 MT is likely to be negated by ~18 MT of capacity
additions. However, we expect the utilisation rate to start improving from
FY13E (79%) as the incremental demand (~20 MT) will keep pace with
effective capacity addition (~23 MT).
Industry outlook
We expect the all-India cement consumption to grow ~6% YoY in FY12E
as we expect demand from the housing and infrastructure segments to
remain under pressure on account of key issues like rising cost of capital,
land acquisition & clearances and unavailability of key raw materials like
coal to the manufacturing industry. However, the overall demand would
be higher than in FY11 on the back of lower base and anticipation of
demand reviving post monsoon. The capacity utilisation rate is expected
to decline further to 76% in FY12E as incremental demand of 12.5 MT is
likely to be negated by ~18 MT of effective capacity additions during the
year.
We expect the utilisation rate to start improving from FY13E onwards as
the incremental demand of ~20 MT is likely to keep pace with effective
capacity addition of ~23 MT in FY13E. We expect the utilisation rate to be
at ~77% in FY13E as against ~76% in FY12E.
In FY11, the all-India cement consumption grew ~4% YoY as demand
remained muted during the year on account of a slowdown in
construction activities, both in the infrastructure and residential segments,
mainly due to rising cost of capital, longer-than-expected monsoon during
the year, political uncertainty in Andhra Pradesh (the largest cement
consuming state in the southern region), Gujjar agitation in Rajasthan and
unavailability of sand and shortage of railway wagons to dispatch the
commodity on schedule. The capacity utilisation rate declined to ~77% in
FY11 from ~87% in FY10 on account of addition of ~44 MT of effective
capacity in FY11 as against incremental demand of ~9 MT during the
period.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
September dispatches remain muted…
Cement majors report ~3% YoY growth in dispatches, decline ~5% MoM
In September 2011, the major cement players reported an aggregate
dispatch growth of 3.4% YoY. However, the companies have shown a
mixed performance. ACC reported 9.5% YoY growth in dispatches during
the month on account of Chanda capacity expansion, Jaypee reported
~17% YoY growth in dispatches, Ambuja Cement reported muted ~3%
YoY growth while UltraTech reported ~2% YoY decline and Shree
cement reported ~9% YoY decline in dispatches.
On an MoM basis, UltraTech, ACC and Shree Cement reported ~8-14%
decline in dispatches while Ambuja and Jaypee reported muted ~2-3%
growth in dispatches. The dispatches were lower on a sequential basis on
account of a slowdown in construction activities due to monsoons.
In August 2011, overall industry dispatches grew ~6% YoY while it has
declined ~6% on an MoM basis as the offtakes were impacted by a
slowdown in construction activities due to monsoons.
All-India average cement price picked up by | 10 per bag MoM in Sep ‘11
All-India average cement price have increased by ~| 5-20 per bag in
September 2011 across all regions (except south). This price increase
happened after the correction of ~| 40 per bag during May-August 2011.
The recovery in cement prices is due to expectations of pick up in cement
demand as the monsoon ends. In the north and central region, prices
have increased by ~| 10-20 per bag MoM while prices have sustained in
the southern region and remained flat MoM. We expect cement prices to
recover further in October 2011 on account of a pick-up in dispatches.
Industry outlook
[
We expect all-India cement consumption to remain muted and likely to
grow by ~6% YoY in FY12E as against long term average growth of ~9%
CAGR. Muted demand is mainly on account of key issues like rising cost
of capital, slowdown in government projects, delay in construction
activities due to issues in land acquisition & clearances, political
uncertainty in Andhra Pradesh and unavailability of key raw materials. The
utilisation rate is expected to decline to 76% in FY12E as the incremental
demand of 12.5 MT is likely to be negated by ~18 MT of capacity
additions. However, we expect the utilisation rate to start improving from
FY13E (79%) as the incremental demand (~20 MT) will keep pace with
effective capacity addition (~23 MT).
Industry outlook
We expect the all-India cement consumption to grow ~6% YoY in FY12E
as we expect demand from the housing and infrastructure segments to
remain under pressure on account of key issues like rising cost of capital,
land acquisition & clearances and unavailability of key raw materials like
coal to the manufacturing industry. However, the overall demand would
be higher than in FY11 on the back of lower base and anticipation of
demand reviving post monsoon. The capacity utilisation rate is expected
to decline further to 76% in FY12E as incremental demand of 12.5 MT is
likely to be negated by ~18 MT of effective capacity additions during the
year.
We expect the utilisation rate to start improving from FY13E onwards as
the incremental demand of ~20 MT is likely to keep pace with effective
capacity addition of ~23 MT in FY13E. We expect the utilisation rate to be
at ~77% in FY13E as against ~76% in FY12E.
In FY11, the all-India cement consumption grew ~4% YoY as demand
remained muted during the year on account of a slowdown in
construction activities, both in the infrastructure and residential segments,
mainly due to rising cost of capital, longer-than-expected monsoon during
the year, political uncertainty in Andhra Pradesh (the largest cement
consuming state in the southern region), Gujjar agitation in Rajasthan and
unavailability of sand and shortage of railway wagons to dispatch the
commodity on schedule. The capacity utilisation rate declined to ~77% in
FY11 from ~87% in FY10 on account of addition of ~44 MT of effective
capacity in FY11 as against incremental demand of ~9 MT during the
period.
No comments:
Post a Comment