The 240-million-tonne cement industry registered new high in despatches in January, due to robust demand from the cement consuming sectors.
The industry, with over 50 players, sold 18.19 million tonnes (mt) in January, surpassing its earlier high of 18.1 mt in March 2009. At the same time, the industry's despatch growth stood at 12.77 per cent on a year-on-year basis, the highest since August last year.
Sumit Banerjee, managing director, ACC, the country's largest cement maker, said, "We shall see more of cement consumption growth as the country gets its act together in infrastructure."
Propelled by significant demand rise in the northern, central and eastern regions of the country, the industry experts said that in the current quarter despatches will further rise on the back of consistent demand from infrastructure sector to end the current financial year with a despatch of close to 20 mt in March.
“Indian economy has been on a drive with special emphasis on infrastructure development. The newly set up capacities are now getting stabilised and the month-on-month increase in the production and despatches is reflecting the same," said Vinita Singhania, president, Cement Manufacturers' Association.
Hari Mohan Bangur, CMD, Shree Cement, said, "Demand for cement is being felt from all corners. Individual house builders, infrastructure and real estate are the major drivers for growth. Moreover, demand from the developers in the mega cities, which was relatively numb in the earlier part of the current financial year, has picked up."
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Barring country's largest cement maker ACC and its sister concern Ambuja Cements, which are unable to produce more due to capacity constraints, all the major players registered substantial rise in production in January. Production at 18.16 mt is the highest ever in industry's history.
For instance, emerging cement giant Jaiprakash Associates came up with a whopping growth of over 60 per cent whereas JK Lakshmi Cement posted 38 per cent rise in its despatches in January. Similarly, Birla firms - UltraTech Cement and Grasim Industries - sold 16.5 per cent more cement and Shree Cement's despatches jumped 18 per cent.
Industry analysts pointed out that north-based emerging players are reaping benefits of the growth momentum as they have materialised their expansion projects.
The indusry has so far added around 22 mt of new capacities and is expected to take its overall capacity to close to 245 mt in the current financial year.
The country's cement consumption has risen from 113.86 mt back in 2003-04 to close to 190 mt in 2008-09. This, further, is expected to rise up to 205 mt in FY10. Likewise, during this period, industry has almost added another 100 mt of manufacturing capacity in its kitty from 144 mt to 240 mt currently.