Gujarat Ambuja Cement

Price on 16/1/98: Rs 241

Price on 9/1/98: Rs 274

The scrip has lost 12.04 per cent during the last week. In a bad year for the cement industry Gujarat Ambujas performance in the year ended June 30, 1997 has been quite good. Sales increased 26.1 per cent to Rs 921.50 crore but depressed market conditions caused a 3.7 per cent decline in realisation which led to a fall of 10.4 per cent in net profit to Rs 132.38 crore. The scrip seems to be on the downtrend currently due to the effect the turmoil in the South East Asian countries is expected to have on Indian cement producers. As a result of the sharp depreciation in the currencies of these countries cement exports from India are likely to be affected as imports from these countries will be more attractive. Gujarat Ambuja is one of the major exporters of cement with 10 per cent of its turnover constituting of exports. The company has acquired a five per cent stake in Priyadarshini Cements and has also taken over control of the sick Modi Cement in which it plans to pump in Rs 166 crore. It has a two million tonne clinker plant in Himachal Pradesh, three clinker plants of 1 million each in Gujarat and a 1 million grinding plant each in Himachal and Punjab.