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| Cement industry registers 6.34% growth in Feb |
| Chandan Kishore Kant / Allahabad Mar 12, 2010, 00:47 IST |
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 After a continuous 9 per cent plus growth since November, the domestic cement industry registered the lowest growth in the second half of the current financial year.
Experts expected a double digit growth in February, but the industry could manage 6.34 per cent growth in the month against 8.3 per cent growth in the previous year. Even on a month-on-month (m-o-m) basis, the growth is half of January’s growth of 12.8 per cent.
The overall despatches stood at 17.11 million tonnes against 16.09 million tonnes in the corresponding month last year. So far, during the current financial year, after September, February has proved to be the second poorest month in volume growth. Moreover, on the production side too, the growth fell to 8 per cent.
Hari Mohan Bangur, managing director of north-based Shree Cement, said, “It is a short-term phenomenon. Primarily due to Holi, labourers were unavailable due to which construction activities took a hit. Else, the demand for cement is robust and there is no mismatch in supply and demand.”
A top official in Ambuja Cement agreed with Bangur on the labour issue but added that because of uncertainty on the excise structure, less buying in the second half of the month could have also had an impact on the industry’s growth.
With 2 per cent rise in excise duty, the cement prices were up around Rs 8-10 per bag of 50 kg.
Industry analysts said that north has seen some demand problem. “There has been a dip in month-on-month despatches of players which have good presence in the northern region,” said an analyst with a domestic brokerage firm.
Another analyst said that as infrastructure projects in connection with the Commonwealth Games in New Delhi are nearing completion, demand for cement in the north will normalise.
For instance, Shree Cement witnessed a decline of 11 per cent, Grasim Industries saw a 7 per cent fall in despatches on a month-on-month basis. Similarly, ACC and Ambuja Cements registered 10.5 and 3 per cent fall in their sales compared with January.
With the unexpected slower than expected growth in February, the entire growth for the current financial year stands at 10.71 per cent during the period April-February. This, however, was above 11 per cent till January, 2010.
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