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Cement prices have gone up by Rs 10-15 to Rs 300 a bag in select regions, even as demand recovery remains uncertain.
The northern region witnessed the sharpest hike. In Delhi, it was up by Rs 15-20 to Rs 285 a bag.
Prices in Maharashtra
However, prices in Maharashtra remained stable at Rs 300 a bag, as the south-west monsoon is expected in the next few days, according to market sources.
The rise in operational cost and freight rates has led to companies to increase prices. Domestic coal prices increased by 60 per cent, while Railways also revised its rates higher in the March quarter.
Major cement companies have reported better sales in May largely due to a lower base last year.
The price hike has surprised many, as cement companies reduced prices in May by Rs 5-12 a bag in order to reduce inventory.
‘Fall in prices unusual'
Mr Basanth Patil, Senior Research Analyst, Dalmia Securities, said the fall in cement prices was unusual, as prices are generally hiked in May before it is brought down during monsoon.
Major cement companies had to cut production in May to offload their stocks. Labour shortage and lesser sand supply in few northern regions lead to cement inventory pile up in April.
Shares of major cement companies ended the day in green on the bourses.
ACC and Ambuja Cement gained three and four per cent at Rs 1,158 and Rs 153.
Jaiprakash Associates jumped four per cent at Rs 66. Shree Cement was up five per cent at Rs 2,462, while UltraTech Cement rose one per cent to Rs 1,395 on Wednesday.
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