Domestic cement industry poised for demand recovery in construction season

Amid a strong demand outlook, brokerages see capacities and existing utilization levels of the domestic cement industry on a rise in coming years

With the onset of a busy construction season, brokerages are optimistic of a demand and price recovery in the domestic cement sector in the coming months.

"Though input prices have seen some moderation recently, a sustainable improvement in demand/price is critical for the industry’s profitability going ahead. We remain hopeful of demand/price recovery in the coming months with the onset of a busy construction season," said Emkay Research report.

In Q2FY22, higher variable costs affected the profitability of the domestic cement players, leading to an 11 percent year-on-year drop and 17 percent sequential fall in earnings before interest, taxes, depreciation,