The cement manufacturers have started increasing prices across the country after the monsoons, failing to bring cheer to festival-season monthly production and despatch numbers.
In fact, biggies UltraTech and Ambuja have posted flat or lower production and sales for September.
UltraTech, the Aditya Birla-managed cement arm, posted lower sales and production numbers last month. The country’s largest cement manufacturer’s production fell from 2.82 million tonnes in September last year to 2.77 million tonnes for the month this year — a drop of 1.77 per cent.
Also, despatches for the month stood at 2.76 million tonne, as compared to 2.85 million tonnes during the corresponding period last year —a 3.16 per cent drop.
Not different is the case with Ambuja Cements. The Switzerland-based Holcim-controlled cement manufacturer, too, has witnessed a fall in its production number for September.
It produced 1.46 million tonnes this Sepetember as compared to 1.48 million tonnes last year during the same period. Though the production was less, the company managed to sell its earlier inventory, thereby despatching 1.55 million tonnes as compared to 1.52 million tonnes last year.
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Though this year’s cement prices are higher than last year’s across the country, analysts say cement manufacturers will start cutting productions in the coming months so as to sustain margins. An analyst from a domestic brokerage says the only way these manufacturers can increase margins is by hiking prices.
“That,” he notes, “will only happen when they start cutting production. In the South, all the players have shown maturity and kept tighter check on production figures.
As sale season kicks in, they have again begun cutting down their supply.”
A few companies that have seen an increase in production include Jaiprakash associates and ACC.
Jaiprakash, the North-based company, said its despatches increased to 1.35 million tonnes a jump of 17 per cent. Its new capacities have started trial production, thus helping it post higher numbers. The entity is going to increase its cement capacity to 35 million tonne by the end of this financial year.
ACC, the second arm of Holcim in the country, on the other hand posted an increase of 9.8 per cent in its production numbers -- at 1.67 million tonnes. This, when the figure was 1.52 million tonne in the same period last year.
Its despatches also increased from 1.58 million tonne in the corresponding quarter last year -- to 1.73 million tonne. That is a jump of 9.5 per cent.