News and Articles

Cement prices across India dropped by 4.63% in the fourth quarter of FY2023 (till March 10, 2024). This decrease could impact cement companies if demand doesn't increase enough to make up for lower revenues.

Prices fell in all major Indian regions, with the eastern and southern areas experiencing the largest quarter-on-quarter drops of around 5.4%. In the south, price reductions were more pronounced among regional brands, attributed to government project payments tying up working capital.

Over the last four months, prices have been declining in all regions except the west. The eastern region recorded the biggest reduction in average cement prices since October, at 10%. The north and south saw decreases of 7.7% and 7.4%, respectively, and the central region had the smallest drop at 5.5%.

Cement companies reported lower-than-expected volumes in the third quarter, impacted by weak demand due to state elections, a construction ban in the National Capital Region, adverse weather in Tamil Nadu, and labor shortages during the festive season.

Sales continued to be negatively influenced by regional challenges, including severe winter in the north, the Pongal festival in the south, budgetary constraints in some eastern states, and farmer protests in the NCR and Punjab.

However, analysts are forecasting a mid-single digit increase of 10–11% in industry volume quarter-over-quarter in March, driven by strong demand from government infrastructure projects and the peak construction season. This outlook is supported by an expected 8–9% year-on-year growth in industry volume for the fiscal year. Statements from various companies in the industry align with this optimistic forecast, indicating expectations for low single-digit volume growth in the fourth quarter.

Read More About Cement Production Cost Reports - Request Free Sample Copy in PDF

According to Procurement Resource, cement prices in India experienced a decline in the last quarter of FY2023, posing potential revenue challenges for companies if demand doesn't rise. The east and south regions witnessed the most notable price falls, particularly among southern regional brands affected by financial constraints due to delayed government payments. Price reductions have been a trend across most regions for the past few months. The industry faced lower volumes in the previous quarter due to weak demand from various disruptions, with ongoing regional challenges further impacting sales.