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Morgan Stanley Downgrades Cement Industry

March 13, 2007

Morgan Stanley has downgraded the Indian cement sector. Jeez! the downgrade has been very severe and the sector is likely to underperform in short-medium term.

ACC:
The report said government intervention has rendered the pricing power meaningless. They further downgraded the stock from Overweight to Underweight and set a new price target of Rs 598, implies a downside of 23%.

Gujarat Ambuja Cement:
Same reason as above and stock downgraded to Underweight with a price target of Rs 84.

Grasim Industries:
Same reason and stock downgraded to Underweight with a price target of Rs 1,783.

Ultratech Cement:
This is the worst hit company and the stock has been downgraded to Underweight with a target price of Rs 554.

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