Local impact of foreign merger:Edelweiss

Apr 14 2014, 11:54 IST
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SummaryThree possible scenarios arise here from merger of Lafarge and Holcim

higher dividend payout ratio of 30-50%.

Sector view

We maintain cautious view on Indian cement industry, as despite assuming demand growth of 6/7% in FY15/16, industry utilisations are expected to remain subdued at 74% levels.

We maintain our Reduce recommendation on Ambuja Cement and Hold on ACC.

Key risks

* Production discipline-led cement price hikes will pose upward risk to our earnings estimates.

* Sharp decline in input cost.

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