The Iran-Israel conflict has disrupted fuel supply in Morbi, forcing shutdowns at 90 to 95 out of 700 to 725 tile plants amid propane shortages and potential cessation of Gujarat Gas supply after March 15. According to reports from The Economic Times, fuel switching offers limited short-term flexibility as controlled shutdown and restart takes two to three days and kiln modifications for alternatives such as RLNG could take at least a month. The export outlook remains weak as 35 to 40% of Morbi shipments go to the Middle East, where trade flows are currently disrupted. As per ET Online, the impact of the Iran-Israel crisis has finally hit home as tile manufacturing hub Morbi faces fuel shortages, with the outlook remaining weak even as the war entered its 13th day with a likely truce remaining out of sight in the near term.
Cera Sanitaryware has been the biggest laggard, falling 26% in the past six months while witnessing an 11% correction over a one year period. As reported by The Economic Times, Kajaria Ceramics declined 24% in the past six months while maintaining a 5% uptick over a one year period. Somany Ceramics fell 20% over a six month period and 9% in a year. The Nifty is down nearly 5% in the past six months while the BSE Sensex has corrected 6% in the same period. According to ET Online, Cera shares are currently trading at ₹939.90, down 2% from Wednesday's closing price, while Kajaria shares have declined 24% in the past six months and Somany Ceramics stock has declined 20% over a six month period.
JM Financial analyst Dharmesh Shah believes organised players are better positioned due to higher inventory (45 to 60 days versus 18 to 20 days for unorganised units). According to the analysis reported by The Economic Times, the ongoing disruption could lead to the permanent closure of 5 to 6% of plants. Phased price hikes of ₹25 to ₹85 per sqm (7 to 15%) for GVT and PVT tiles by organised players are expected as gas accounts for 20 to 25% of production costs. Kajaria Ceramics receives a Buy recommendation with target of ₹1,125 implying 17% upside, while Somany Ceramics gets an Add rating with target of ₹435 offering 18% potential upside. As per ET Online, JM has an Add rating on Somany, a company with a market capitalisation of ₹1,552 crore, with the stock offering 18% potential upside.
Cera Sanitaryware has informed exchanges about receiving communication from Sabarmati Gas regarding provisional restrictions on gas supply up to 50% of the Daily Contracted Quantity with effect from March 6, 2026 till further notice. As reported by The Economic Times, Somany Ceramics earlier informed exchanges that it received communication from GAIL (India) stating that its plant in Bahadurgarh, Haryana will receive restricted gas supply according to revised supply regulations issued by the Ministry of Petroleum and Natural Gas on March 9. According to ET Online, Somany earlier informed the exchanges that it received a communication from GAIL (India) stating that its plant in Bahadurgarh, Haryana will receive restricted gas supply according to the revised supply regulations issued by the Ministry of Petroleum and Natural Gas on March 9. The gas supplies to industrial consumers will be maintained at 80% of the past six months' average gas consumption and any overdrawal will be invoiced as per the applicable contractual terms and conditions, with effect from March 12.
