​Indian equities have been underperforming, partly owing to the regional reallocation of money in the new year. This year, foreign portfolio investors have been net sellers to the extent of Rs 14,123 crore in the secondary market.

Record production, surging exports and the ethanol story is working wonders of Indian sugar companies. But can the past returns sustain despite an ongoing correction?

Given the way things are shaping up for the sector and also with regards to the input prices coming out for some of these auto and auto ancillary companies, the margins would more likely be stable. You would see some amount of volumes coming back for this sector as well as some kind of margin tailwinds for the sector.

I am a little worried with the kind of momentum we are seeing with smaller bank stocks be it PSU banks, Yes Bank and many other midcap infra companies.

The brokerage maintains its buy on the stock with a revised price target of Rs. 2,250, increasing its valuation multiple to factor in faster capacity additions and its strong growth potential led by capacity expansions.

Dalmia Bharat, incorporated in the year 2013, is a Mid Cap company (having a market cap of Rs 34869.17 Crore) operating in Cement sector.

“Nifty has reclaimed 18,500 after a brief slip below the crucial level. However, the overall sentiment remains subdued as the index needs to move above 18,700 for bulls to take control. Over the near term, the trend may remain sideways,

The big deal announcement by Dalmia Bharat has been attractively valued at $73 per tonne which is much below the replacement cost of dollar 120 per tonne. So the acquisition is attractively valued.

Following the development, brokerage firm Jefferies said, "If the acquisition fructifies, it will enable Dalmia to expand its footprint into the Central Region and add one more region to its vision of emerging as a pan India cement player. Deal timelines, additional required capex, limestone reserves are key for the company.”

Promoters held 55.87 per cent stake in the company as of 30-Sep-2022, while FIIs owned 14.01 per cent, DIIs 8.01 per cent.

JP Morgan maintained its overweight rating on Dalmia Bharat with a target price of Rs 1845. Proposed acquisition at attractive valuations which will give Dalmia a pan-India footprint, it said.

The assets put together have a cement manufacturing capacity of 9.4 million tonnes per annum (MTPA), including clinker capacity of 6.7 million tonnes and thermal power plants of 280 megawatts and are situated in Madhya Pradesh, Uttar Pradesh, and Chhattisgarh.

Low cane yield in major states like Maharashtra and Karnataka is one of the major reasons for the drop in sugar output. Reuters has reported that on an average, farmers reported a 15-35% drop in cane yield.

Dalmia Bharat, incorporated in the year 2013, is a Mid Cap company (having a market cap of Rs 35965.86 Crore) operating in Cement sector.

Churning action is expected to continue for the next few weeks. Upside count of Nifty as per P&F chart continues to be open around 19,300, yet we are likely to see range-bound action between 18,500-18,900 in the near term.

The weakness on Wall Street on Friday could weigh on Asian markets on Monday. Ashok Leyland, LIC Housing Finance, Voltas, Havells, Crompton, SBI Cards, Chola Finance, and Aditya Birla Capital are some of the stocks investors can buy for short-term trades, said analysts.

The company targets industry-leading volume growth in the near future. A turnaround in east profitability is key, it said. “With volume growth/cost leadership, Dalmia is a strong mid-cap cement play,” said the note.

We are positive on the cement industry dynamics for the next few years due to 1) better demand prospects led by infrastructure and housing sector, 2) increased consolidation in the industry and 3) regulatory changes in the allotment of limestone blocks.

ICICI Direct is bullish on Dalmia Bharat Sugar recommended buy rating on the stock with a target price of Rs 490 in its research report dated November 09, 2022.

​Nifty is holding on at a higher support base and we expect positive momentum to continue to drive the index to higher zones. Mechanical indicators are giving a bullish crossover which indicates up-move momentum could continue in the coming sessions.

Supreme Industries declared a special dividend of Rs 6/- per equity share. The stock shall trade ex-dividend on November 7, 2022. In the past 12 months, the company has declared an equity dividend amounting to Rs 18 per share. On Friday, the scrip was trading 1.63% higher at Rs 2,237.10, over its last days closing price of Rs 2201.30.

Amid the ongoing earnings season, Adani Enterprises, Ajanta Pharma, Amara Raja Batteries, Bank of India, Blue Star, HDFC, HPCL, Vodafone Idea, JK Lakshmi Cement, Mahindra Lifespace, Rain Industries, Raymond, Sanofi India, SKF, GMM Pfaudler, Hawkins Cookers, Devyani International, Sapphire Foods and UCO Bank, among others, will be announcing their Q2 results.

HDFC, Adani Enterprises, HPCL, Coromandel, Vodafone Idea, Bank of India, Devyani International, SKF, Ajanta Pharma, UCO Bank, Sanofi, Blue Star, Sapphire Foods and Amara Raja are among the companies that will announce their results for September 2022 quarter today.

Revival of retail and institutional demands on the back of receding monsoon and pick up in construction activities owing to lower prices of building raw materials are likely to aid cement companies going ahead

Revival of retail and institutional demands on the back of receding monsoon and pick up in construction activities owing to lower prices of building raw materials are likely to aid cement companies going ahead

M&A activity in the sector has led to increased consolidation in north, central, and east India over the last few years. While west India saw a de-consolidation due to the entry of new players (such as Dalmia Bharat, Birla Corp, and Shree Cement, with combined capacity addition of 10mtpa), the South remains the most fragmented market with a capacity share of ~43% for the top five players in FY23E.

“The last several years has been largely retail-led credit growth but we expect the corporate credit growth to pick up. Anyway with higher inflation levels working, capital requirements are also going up. We are fairly positive on lenders as rising interest rates would be positive for their NIMs, at least in the initial part of the rate cycle. Financials is definitely a good space.”

“Hotel companies will continue to do well. If they are put in two brackets – one is the mid income and above mid income which is where Mahindra Holidays, Thomas Cook fall into and then the luxury end of the segment which includes India Hotels, Chalet Hotels, Taj Hotels and the Marriotts of the world.”

“Cement has benefitted from the fall in raw material cost and that 30-40% drop will add to the EBITDA level. Clearly volumes are going to pick up and the largest amount of uptick will happen in the South which means companies like Dalmia Bharat, Ramco Cements as well as national players like UltraTech will benefit. JK Lakshmi will benefit from sheer valuation comfort.”

“I do not know how much more one can expect but yes, if the sectoral move is what you are looking at, clearly UltraTech is one of the bigger beneficiaries. If you are looking at companies which will become big, there is a likelihood of volume growth, commensurate with an increase in prices. My own favourite would be something like Dalmia Bharat.”

The valuations of cement stocks are also not demanding as they are still trading well below their five-year averages, Rakesh Arora of GoIndiaStocks, said. "UltraTech used to trade at 19-20 times its five-year average.

“Global freight rates are easing, down by 40% to 60% on main routes since January currently and are expected to further go down. This has been putting downward pressure on imported fuel prices. Our top picks in the cement sector are UltraTech, Shree Cement, Dalmia Bharat, JK Lakshmi Cement and Shree Cement.”

"In the immediate term, markets may find support from softer crude and news flow around the inclusion of G-Secs in global bond indices. However, this may not last for long; and therefore, we add incremental defensiveness to our portfolio by shifting some allocation away from metals and energy toward FMCG and pharma,” Emkay Global said.

For the quarter ended June 30, 2022, the company reported a consolidated total income of Rs 3324.00 crore, down 3.18 per cent from last quarter total income of Rs 3433.00 crore and up 27.11 per cent from last year same quarter total income of Rs 2615.00 crore.

The domestic brokerage listed 13 stocks to play the multi-year theme. Financials - ICICI Bank and Axis Bank, capital goods/infra - L&T, Siemens, Cummins, and GR Infra and capacity expansion-led volume growth - UltraTech, Dalmia Bharat, Navin Fluorine, Aarti Industries, NTPC, Phoenix Mills, and Havells India.

CLSA maintained a buy rating on Eicher Motors with a target price of Rs 4154. The stock closed at Rs 3363 on 22 August. The company is seeing a strong replacement demand which is likely to support Royal Enfield's volume growth, CLSA said. "Exports are likely to be a key growth area. Royal Enfield's EBITDA per vehicle is poised to climb higher," said the note.

"The company recorded a strong beat on margins led by costs. Volumes were slightly lower. The cement major recorded a strong performance on variable costs," it said in a note.

Its revenue from operations increased 27.44 per cent to Rs 3,302 crore during the quarter under review against Rs 2,591 crore in the corresponding period of the previous fiscal.Dalmia Bharat's total expenses rose 37.7 per cent to Rs 3,072 crore in Q1 FY 2022-23 from Rs 2,231 crore a year ago.

ICICI Direct is bullish on Dalmia Bharat Sugar has recommended buy rating on the stock with a target price of Rs 490 in its research report dated July 31, 2022.

Cement stocks, excluding a few such as ACC and Ambuja, have corrected by 25-40% over the last six months, driven by a muted pricing scenario in a cost inflationary environment. But the current trading multiple of the sector is higher than the long-term median multiple. Still, analysts remain positive on UltraTech, Ambuja, ACC, Dalmia Bharat, Shree Cement and JK Lakshmi Cement.

Large manufacturers, such as UltraTech Cement, Ambuja Cements and ACC, have better bargaining power given their scale which helps them achieve lower cost of production compared with smaller rivals. They also tend to have better distribution channels, which helps them improve their market share and capacity utilisation.

"Aligned with the government's vision of building a stronger India, we committed a CAPEX of Rs 9,000 crore+ over the next few years. We are eyeing greenfield units and the debottlenecking of our existing plants to achieve our targeted capacity addition," said Dalmia Bharat.

​​The market also seemed cautious amid the ongoing RBI policy meeting. The Nifty50 closed 0.92 per cent lower at 16,416.35 and the BSE Sensex slipped 1.02 per cent to 55,107.34.