Asian stock markets are mixed today. The Shanghai Composite is up 0.28%, while the Hang Seng is up 0.24%. The Nikkei 225 is trading is lower by 0.52%. European stocks fell marginally on Tuesday amid geopolitical tensions.
Meanwhile, Indian share markets have opened the day on a flat note. The BSE Sensex is trading higher by 12 points and the NSE Nifty is trading higher by 3 points. S&P BSE Mid Cap and S&P BSE Small Cap are trading up by 0.1% and 0.2% respectively.
Sectoral indices opened the day on a mixed note with energy stocks and power stocks leading the gains. While FMCG stocks and information technology stocks opened the day in the red. The rupee is trading at 64.82 against the US$.
Cement stocks opened the day on a mixed note with India Cements and JK Lakshmi Cement leading the losses. As per an article in a leading financial daily, Ultratech Cement has reduced prices of its products by 2-3%, extending the benefits of tax reduction under the GST regime.
The company has started supply of batches on new rates from 1 July from its warehouses, when the new tax structure came into force.
Cement has been taxed at 28% under the GST as compared to 30% to 31% in the previous system of taxation.
Last month, ahead of GST implementation cement offtake by dealers had slowed down due to speculation over tax rates. There will be somewhere 2% to 3% reduction in cement prices because of reduction in tax rates due to GST.
Speaking of cement sector in India, the cement sector was always in a need of revival considering its important role in India’s growth story. The logical route seemed to be consolidation.
Consolidation is expected to increase the pricing power of the top producers and lead to better margins. There’s been one downside though. All this consolidation has weakened the balance sheet of these top cement companies.
