The sordid deeds of his son-in-law may have aggravated the underperformance of N Srinivasan-controlled India Cements shares over the last month. But even adjusting for that, India Cements shares have had a disappointing run over the last year. And the growing feeling in the market is that Srinivasan has taken his eye off the ball, at least where his primary responsibility is concerned. In contrast, shareholders in rival cement companies have made decent gains over the last one year, despite the sluggish trend so far this calendar.
Sentiment for the sector in general has soured of late, as demand is not showing signs of a sustained pick up. “We retain our ‘sell’ stance on large-cap cement players, given the rich valuations at a time when weak demand risks loom large on pricing,” brokerage house Ambit said in its note to clients earlier this week.
The outlook is even bleaker for India Cements as shareholders are worried about what the probe into the IPL spot fixing case holds for India Cements, since N Srinivasan’s son-in-law Gurunath Meiyappan is among the key accused.