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Cement Sector Bets Big on Infrastructure, Housing Boom
5 Mar
Summary
- India's cement industry relies on infrastructure and housing demand.
- Companies face volatile demand and limited pricing power.
- Capacity additions of 158 million tonne planned by FY28.
India's cement industry is poised for growth, banking on robust demand from infrastructure projects and the housing sector. Companies are navigating a landscape characterized by fluctuating demand and constrained pricing power, often necessitating price rollback to stimulate sales.
Despite current capacity utilization rates hovering between 60% and 70%, the sector is actively pursuing expansion. Over the fiscal years 2025 through 2028, Indian cement firms have announced plans to add approximately 158 million tonnes of capacity. This represents a compound annual growth rate of 7.4% in new capacity.
While these expansion efforts are supported by cost efficiencies that bolster earnings, the industry remains watchful of potential supply-demand imbalances. The significant capacity additions signal a strong belief in sustained economic development and urbanization driving future cement consumption.
