Kajaria Ceramics to get big push from GST, affordable housing schemes: Sharekhan

MUMBAI: Kajaria will be the biggest beneficiary from GST rollout as it is the largest tiles manufacturer in India, said Sharekhan.

Stocks of Kajaria Ceramics rose 3.37% on Friday.

“The impending implementation of GST will provide a level-playing field to the company, helping it to increase its market share price gap will reduce between branded and unbranded players. Further, there will be room for higher realisations to maintain premium pricing of the company’s products, which should result in an enhanced profitability going ahead,” the report said. Kajaria currently operates in an unorganised market where 50% is the market share of the unorganised market in India, with national brands cornering 50% share.

Shares of Kajaria Ceramics have risen 25% since the beginning of the year. Earlier this month HSBC Bank Mauritius Ltd AC Jwalamukhi Investment Holdings had sold a total of 9,94,905 shares or 0.63% stake of Kajaria Ceramics, based on the bulk deal data available with BSE.

India’s per capita consumption of tiles is low compared to Saudi Arabia, China and Brazil. The government’s thrust on Affordable Housing & Smart Cities, rising per capita income and the Seventh Central Pay Commission bounty are other key structural triggers for the Indian tiles industry in general and specifically for Kajaria to drive sustainable long-term growth, the brokerage said.