Shares of cement stocks- Ambuja Cements and Ultratech inched higher on July 15 after Morgan Stanley rolled out bullish views for the two industry majors. The brokerage firm upgraded Ambuja Cements to 'overweight', raising its price target to Rs 775. Alongside, it also raised the target price for Ultratech Cement to Rs 13,620, while retaining its 'overweight' call on the stock.
Reacting positively to the bullish views, at 10.13 am, shares of Ambuja Cements were trading at Rs 685.15 and Ultratech Cement at Rs 11,731.05 on the NSE, both up over 1 percent.
Morgan Stanley believes in the near-term, the industry may move sideways due to limited upside triggers. However, the brokerage feels the medium-term outlook for the sector and the two majors, remain robust, thanks to demand-led margin expansion which is still intact.
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On that account, the Morgan Stanley also expects with stocks with capacity share gains and cost improvement capabilities to do well. Likewise, the brokerage believes a bull case is in play for Ultratech Cement and Ambuja Cements.
This comes after brokerage firm Nomura double upgraded Ambuja Cements to a 'buy' rating last week, factoring in the company's aggressive capacity expansion.
Along with this upgrade, the brokerage firm had also raised its price target for Ambuja's stock from Rs 500 to Rs 780, marking a significant increase of nearly 56 percent.
Nomura attributed this sharp rise in the price target to Ambuja's entry into newer markets and its industry-leading volume growth.
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