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March 01, 2019

Sector Report: Cement

This report is available to users in India for ₹40,000 + applicable taxes


Table of Contents


  • Summary
  • Segment-Wise Demand
  • Region-Wise Demand
  • Capacity Additions
  • Blending
  • Operating Rates
  • Long Term Outlook
  • Costs & profitability
  • State-wise Analysis




Demand growth to rise at 5.5-7% in FY20, margins to expand (reversing trend of last two years)


Robust demand growth witnessed in 9MFY19 at 12.5-13%; to moderate in next fiscal


Continuing on the momentum gained in the previous year, cement demand is expected to rise at 11-12% in FY19. Infact demand grew at a rapid pace of 12.5-13% in 9MFY19 led by low base (GST in H1FY18) and healthy growth from East and South. Demand for the years is expected to be led by affordable housing, rural IHB (indirectly supported by govt. rural initiatives) and infrastructure. High infra spend in pre-election year to auger well for the industry. Cement demand is expected to be driven by Eastern, Central and Southern region.


However, demand is expected to moderate in fiscal 20 as impact of low base is expected to wane. Moreover, demand is expected to be slow in H1 2019-20 on the back of general elections as well as assembly elections in multiple states. Demand is expected to pickup in the second half of the year resulting in a moderate growth of 5.5-7% for the year. Over a five-year period, cement demand is projected to increase at 7-8% CAGR, led by pick up in affordable housing, rise in government spending on infrastructure activities, and healthy rural housing demand. At regional level eastern states followed by central and north regions would see healthier growth with continued state governments focus on development.