LAHORE: The onset of the winter season is likely to weigh in on cement sales in November as local dispatches are likely to fall by 23-27pc MoM, but up 2-6pc YoY.
The North region is expected to witness a contraction of 25-29pc MoM, while sales in the South are likely to fall by 11-15pc MoM.
Topline Securities Limited Deputy Head of Research Shankar Talreja said that the sequential decline is likely to be higher than the past two years’ average decline of 15pc MoM during the month of November.
“We believe this is the case because of restricted development work in the North region due to (1) early onset of the winter season and (2) increasing number of Covid-19 cases,” he maintained.
Talreja predicted that local sales are likely to be still up by 2-6pc YoY during November.
He opined that the exports are likely to decline by 1-3pc MoM, while they are expected to be higher by 6-8pc YoY.
Industry utilisation in November this year is expected to clock in at 82pc as compared to October 2020 utilisation level of over 100pc; adjusted for dead capacities of Flying Cement, Dewan Cement Hattar and Dandot Cement.
Talreja added that during 5MFY21, industry utilisation is likely to clock in at 86pc.
Cement prices in the North region during November have averaged at Rs545 per bag, down Rs5 per bag
Source : Profit