India's cement industry continues to present a puzzle to investors

Given margin pressure and gradual demand revival, companies with strong balance sheet may gain in long run

The cement industry continues to present a puzzle to investors.
 

Five large cement majors with combined market share of about 49 per cent have large capex plans.

This is despite surplus industry capacity over demand and low current utilisation.

Demand is expected to grow at around 9 per cent per annum between FY22-23 and FY24-25. Volume growth during April-December 2022 could be around 10-11 per cent, year-on-year (YoY).

This fiscal (FY22-23) has seen a small increase in demand, with further revival likely over Q4, and through FY23-24. This is due to pre-election construction and likely infra-push in the Union Budget.