Economic recovery likely to benefit second-tier cement names: Prateek Agarwal

In a chat with ET Now, Prateek Agarwal, Business Head & CIO, ASK Investment Manager, shares his views on cement sector. Excerpts:

ET Now: Give us a sense on as far as the cement space is concerned because that was also one cyclical play which the market was worrying a bit about. Are you continuing your focus there?

Prateek Agarwal: Yes, so that is one space that we continue to be positive on. There, the larger companies are looking fully valued. But maybe they still can have an upside. I would really believe that an upside comes from one, better capacity utilisations, two, lower logistic cost. Cost to the market if buoyancy returns should reduce and logistic cost is a huge cost in a cement company and if one sees first signs of economic recovery really coming back, the second-tier cement names may actually do very well because they are trading at a fraction of large cap cement valuations. So we stay positive on the whole space. Today, we are in the mid-tier cement company. Let us see how things happen. We can look at a smaller name as well.