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Cement Demand
The cement demand, which grew 7 per cent year-on-year in April this year, may be impacted by the early onset of monsoon, according to a report by rating agency Ind-Ra. However, overall cement demand is expected to grow in single digits in the June quarter on the weak base a year ago due to general elections, it said. The cement volumes witnessed a "notable recovery of 10-11 per cent y-o-y" in the March 2025 quarter after recording a subdued 2 per cent growth in the first half of the last fiscal. "The recovery was driven by an 11 per cent y-o-y pick-up in infrastructure to Rs 10.5 trillion, led by the central government capex after a similar y-o-y decline in 8M FY25," it said. Despite this late recovery, the weak H1 restricted the overall demand growth for FY25 to 5 to 6 per cent, which is the lowest since the pandemic affected FY21, the report said. Moreover, price hikes also aided the manufacturers in improving sales realisations in Q1 FY26 after a multi-decadal fall last fiscal.
Growing cement demand will fuel consolidation in the cement sector, where large players are acquiring smaller regional players as they rush to increase production capacity to match the rising consumption, said Moody's Ratings. Over the past five years, the cement sector in India has witnessed significant industry consolidation and top 10 producers in the country have acquired around 140 MMTPA (million metric tonnes per annum) of domestic cement capacity, valued at around Rs 890 billion (USD 10.5 billion), from smaller regional players, it said. "Large companies with a pan-India presence such as UltraTech and Ambuja will continue to engage in M&A (merger and acquisition) to acquire smaller regional producers with weaker capacity utilisation and lower profitability," it said. Given the presence of a large number of smaller cement producers, numbering over 70, companies in South India are more exposed to industry consolidation compared with those domiciled in other parts of the ...
Cement demand is expected to cross 640 million tonnes per annum by FY30, said leading player and Aditya Birla group flagship firm UltraTech Cement in an investor presentation. It expects the cement demand to have a compound annual growth rate (CAGR) of 7 to 8 per cent between FY24 and FY30, citing industry estimates and research reports. The cement demand was at 424 MTPA in the financial year which ended on March 31, 2024, according to the investor presentation, a copy of which was submitted to exchanges last week. The "cement demand expected to cross 640 MTPA by FY30," said UltraTech Cement Ltd. The company is expanding its grey cement production capacity and has projected to have 209.3 MTPA output by FY27. UltraTech's capacity has increased to 182.8 MTPA so far in FY25, which includes 5.4 MTPA in overseas, from an overall 140.8 MTPA of FY24. The Aditya Birla group firm is expanding its capacity through acquisitions and brownfield as well as greenfield expansions. It plans to add
Continued government push to build infrastructure will drive cement demand further this fiscal by 8-9 per cent on top of a 9 per cent growth in FY22, which will help the sector see some recovery in profitability, a report said. According to India Ratings, which has a neutral outlook for the sector for the year, recovery in profitability despite the inflationary pressure and healthy balance sheets will keep the sector in good stead despite the large capex pipeline. The agency expects demand to grow 8-9 per cent in FY24 over an estimated 9 per cent growth in FY23, giving the sector a five-year compounded annual growth rate of 4.5 per cent. Softening fuel cost to drive recovery in operating margins even as the industry is likely to increase prices only in low single digit. The agency expects operating margins to recover to Rs 950-1,000/MT in FY24 on the back of softening power and fuel cost. Downside risks could arise from a rebound in coal and petcoke prices, though. After the stron
The Centre and southern states were expected to retain their thrust in giving a push to housing and infrastructure projects leading to cement demand to remain on track, The India Cements Ltd Vice-Chairman and Managing Director N Srinivasan said on Thursday. Increased house building and construction activity in metros, semi-urban and urban centres would boost cement demand although cost pressure is expected to remain with higher cost of fuel, power tariff, he said. "As in the last two years, the good rainfall reported this year from South -West monsoon season augurs well for improved prospects of rural economy," he told the shareholders at the 76th annual general body meeting held through virtual mode. During 2021-22, he said a revival was witnessed in the construction sector which led to the cement demand picking up and it sustained due to increased infrastructure spending by the Centre and States. The industry suffered from steep increase in the cost of production due to ...