Nomura identifies aggressive expansion targets and stronger balance sheets of major cement players as key drivers for sector consolidation.
The current market conditions, reminiscent of FY14-17, indicate better pricing discipline. Ambuja and Ultratech are anticipated to lead this trend.
- Read also: Goldman Sachs unveils new ratings for cement stocks: Ultratech, Shree, Ambuja, Dalmia, and ACC
The plant-based acquisitions are expected to rise due to the CCI’s de minimis exemption, allowing larger companies to acquire assets more easily. Additionally, succession issues offer promoters another reason to exit non-stressed businesses.
Nomura’s top buy recommendations include Shree Cement, Ultratech, Ramco Cements, and Nuvoco.