Boral (ASX:BLD) Managing Director, Mike Kane, has done a good job restructuring the group and the business is positioned to benefit from: a) the coming east coast rail and road infrastructure spending surge, b) the ongoing recovery in the US market, and c) the growth from a low base in its Asian business for the Gypsum joint venture. Looking at these in detail, the east coast infrastructure spend should boost demand for cement and asphalt. BLD is a key player in these markets and it should be able to finally demonstrate pricing power given the scale of the planned projects. We sense BLD’s US building products division, having turned the corner to profitability for the first time since 2006, can now be a beneficiary of the growth in US housing starts. Finally, Kane was also instrumental in forming a joint venture between his former US employer and BLD’s own international plasterboard division, creating the Gypsum joint venture. We believe Gypsum can continue to benefit in terms of growth from its lightweight product and opportunity set in key Asian markets. (VIEW LINK)
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