Mumbai: A
sharp fall in crude oil prices is good for companies spanning industry sectors
such as oil marketing, paints, tyres, speciality chemicals, plastic piping,
aviation, and cement who use it as a key raw material, said analysts.
Mumbai: A
sharp fall in crude oil prices is good for companies spanning industry sectors
such as oil marketing, paints, tyres, speciality chemicals, plastic piping,
aviation, and cement who use it as a key raw material, said analysts.
“Fall in crude
prices is likely to be beneficial for companies in the speciality chemicals
space such as Aarti Industries, Atul, Sudarshan Chemical and also for plastic
piping companies such as Astral Poly Technik and Supreme Industries as it will
ease the input cost pressures and enhance the gross margins,” said Rishab
Bothra, senior research analyst at Sharekhan. “However the same is expected to
be seen with a lag effect.”
Brent crude
has crashed 21 per cent to $52.3 per barrel since the beginning of the year to
hit a 30-month low. The increase in oil production in the US, Brazil, Canada
and Norway and the declining demand from China is adding to the excess supply
of oil. The crude barometer is likely to stay at $50 levels until the demand
outlook in China and across the world improves, which may take another 6-12
months, say economists.
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