Chakri Lokapriya on stocks to pick in cement, banking sectors

economictimes.indiatimes.com:

Chakri Lokapriya, Managing Partner, RSB LLP, says ICICI among the private banks is still ahead. In terms of HDFC, there is still time to get onto the bus. Despite their merger integration and cost of capital issues, it is still a great bank. It has acquired another big home loan provider and it will take time. So, we will still wait on the sidelines until their cost of capital and merger-related issues are all sorted out.
Lots of consolidation is taking place within the entire cement sector, in particular with the news on UltraTech and India Cements. How are you reading into this news?
Chakri Lokapriya: UltraTech is the market leader at about 200 million tonnes.

Adani with ACC and Ambuja acquisitions has become an important player in the cement industry. UltraTech has about 10% market share in the south currently and Ambuja is the next biggest player. With the recent acquisition by Adani of Sanghi Industries, UltraTech had to do something to maintain its position in the south.

So, now, they want to add about 15 million tonnes in the south from India Cements. Now whether they acquire or do not acquire it, that is if they go ahead with their expansion plans, anyway with the 15 million tonnes they will probably have about 20% odd market share and that is important for them in an industry that is consolidating very fast. So, we will continue to see this race between Adani, UltraTech, as well as Dalmia Bharat Group.

Unlock Leadership Excellence with a Range of CXO Courses