Cement stocks playing catch-up: Prakash Diwan

ET Now spoke to Prakash Diwan, Head - Institutional Business, Networth Stock Broking on his views on stocks.

ET Now: How would you read into the kind of move that we have seen in cement? Does it seem like only one off or is that sort of catch up because they had been so beaten down?

Prakash Diwan: I guess so. The levels which we had seen cement stocks would probably now be justified by the fact that cement prices were low and that was very expectedly low.

So it was not that there is some out of turn depression in demand but then its cyclical effect was already underway. Typically if you remember sometime back we discuss cement could start perking up in September because that's when the construction cycle resumes little bit of momentum and there is a smart move from the part of the manufacturers especially down south and possibly even the Gujarat cement producers who would start looking at some sort of a price revival.

So the move is pretty smart in terms of pricing themselves well. So I think all in all it augurs well because the cycle is there to stay and probably it has taken the beating a bit too seriously so the bounce back also has been pretty sharp.