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HDFC Securities Institutional Equities
We estimate that 15 companies under coverage would report ~7% QoQ aggregate seasonal sales volume decline. However, on a low base of last year (Covid impact), aggregate volumes are expected to rise 16% YoY. We estimate average utilisation of ~80% versus 86% QoQ and 73% YoY.
While energy cost continues to rise QoQ, the industry could not fully pass on the inflation across all regions. In our view, cement prices recovered ~5-7% QoQ in the north and central regions, 3-5% QoQ in the east and west regions and ~1-3% QoQ in the southern region.
Thus, we estimate pan-India prices recovered ~4-5% QoQ. Despite good demand, price recovery in south has been inferior. Even east market prices fell off sharply in June, muting the recovery seen in April/May. We estimate average net sales realisation for coverage universe would rise 4% QoQ (5% YoY.
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