Cement makers condemn builders' strike over input cost hike issue

Accuse builders of spreading misinformation among the public in order to further increase real estate prices, which are already at unaffordable levels

South India Cement Manufacturers Association (SICMA) today condemned the proposed strike by Builders Association of India (BAI) on February 12 against rising input cost including cement.

SICMA said builders are spreading misinformation among the public and accused them of trying to take advantage of economic recovery and further increase real estate prices, which are already at unaffordable levels.

SICMA has written to the Prime Minister and Finance Minister to look into profiteering being done by builders.

The Association alleged that across markets, builders access cement at the rate of Rs 6,000 per tonne or below, which means cement accounts for only Rs 150 a sq ft of a built-up area. They wondered how cement prices can impact the increase in their flat construction cost.

Responding to BAI's claims that the price of cement has gone up Rs 100 a bag, SICAM said the CAGR of the price in the past five years has remained flat. "It is their (builders) intent to take higher input credit of GST by giving non genuine bills," alleged SICMA.

SICMA said that it has done detailed costing of a flat construction based on the guideline value of land in different markets. "We see that the total cost of a flat is not even 50 per cent of its sale price," said SICMA, while asking the government to intervene and ask builders to reduce prices, so that the consumers benefit.

The Association also wondered why builders are not reducing price and selling off inventory instead of holding on to finished/semi-finished flats in a "cartelised" manner.