ACC, Ambuja Cement gain on cement price hike

Byyyp

Updated 2012-03-19

Shares of cement makers surged on Monday on reports that companies have announced a price hike of Rs 7-10 per bag of 50 kg w.e.f March 17, after the finance minister announced hike in excise duty.

"The budget has altered the way excise duty is calculated on cement in addition to the increase in excise and service tax rates by 200bp. The price hike will be higher in regions where retail sale price (RSP) is higher as now excise duty will be calculated on RSP methodology instead of invoice value methodology earlier prevalent," said an Angel Broking report.

"We continue to remain Neutral on the sector considering the sector's ahead of the cycle valuations; however, we continue to maintain our Buy recommendation on JK Lakshmi, considering its deep discount valuations, as it is trading at EV/tonne of US$28 on FY2013E capacity," added the report.

Among the individual stocks ACC has moved higher by 2.4% at Rs 1,373, Ambuja Cements rose 2.3% higher at Rs 172, Madras Cements was trading marginally lower at Rs 145.65 and UltraTech Cement gained 0.86% to Rs 1493.05 on the Bombay Stock Exchange.

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