Rajat Rajgarhia, Head-Research of Motilal Oswal Sec told CNBC-TV18, "We were disappointed by UltraTech Cement numbers, we have lowered our estimates and rating. We think that now given that the stock has quickly come back to Rs 2000 levels, the disappointment and the cost inflation which has come into their numbers at USD 140 EV/tonne definitely very low return potential in the near to medium term."
He further added, "We had upgraded ACC also because somewhere in the cement cycle also we are right now quite close to the bottom because cement is again a proxy to how the domestic economy has been behaving and the last four quarters trailing has definitely been one of the low points of the domestic economy. So somewhere in this quarter, next quarter we will see the cycle seeing bottom."
"Within that the interesting part is to buy the companies where you see some volume growth and a lot of operating leverage. ACC would be our preferred names in this pack, so we would be recommending investors to focus on that. UltraTech we just downgraded to neutral, so that is not on our buy list now."
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