Cement stocks were in heavy demand on Wednesday, ahead of their monthly sales data, as investors deepened their purchases in beaten down but fundamentally strong shares in a market that has risen for the fourth session in a row.
Grasim, the flagship of the Aditya Birla Group, led 4 other cement stocks higher between 1.4-2.8 per cent in the futures and options market. Overall, 31 cement shares rose compared with 10 that slipped in the broader market, indicating that bulls were firmly in command of the sentiment in this sector. Most cement makers declare their sales and output for the previous month on the 1st of the subsequent month.
Cement shares experienced heavy selling since November 8, when Prime Minister Narendra Modi announced his plan to demonetize the 1,000-rupee and 500-rupee note in a bid to curtail black money in the economy. The unplanned removal of 86 per cent of cash liquidity from the $2 trillion economy caused a massive sell-off in equities on fears of a demand-supply mismatch. Even though cement shares have gained fresh ground in the past four sessions, the major ones in the futures and options market still remain between 4.4-24 per cent below their closing prices on November 8.
Meanwhile, futures of Grasim gained 2.6 per cent to 874 rupees. ACC was up 2.1 per cent to 1,355 rupees. UltraTech Cement rose 2 per cent to 3,605 rupees, Ambuja Cement added 1.8 to 210 rupees and India Cements was up 1.3 per cent to 119.50 rupees.
Shares of JK Lakshmi Cement gained 3.4 per cent to 388 rupees in the cash cement and JK Cement was up 2.3 per cent to 751 rupees.