Saudi cement sector long-term outlook seen positive: NCBC

NCB Capital adopts a positive long-term outlook for the Saudi cement sector, driven by mega projects and an increase in state capital expenditure, it said in a recent report.

Cement firms in the Western and North-western regions will benefit from the anticipated mega projects in these areas, the report said.

Local cement sales will likely decline by 5-10 percent in 2019, before it rises in 2020 backed by the new projects, it said.

The research firm recommendations on stock ratings varied for cement producers under coverage. It revised Southern Cement rating up a notch to “overweight”, while Saudi Cement’s rating retreated to “Underweight” from “Neutral”.

NCB Capital maintained its recommendation for Yanbu Cement at “Overweight”. Also for Arabian Cement, Yamama Cement, Qassim Cement and Eastern Cement the rating remained at “Neutral”.