Surplus capacity is not good news as large manufacturers compete for market share that could weigh on prices
Cement capacity utilisation for the quarter came down from 88 to 77 percent because of addition of new units. The new plant capacity utlilisation currently stood at around 55 percent, said HM Bangur, Managing Director, Shree Cement.
Cement demand is likely to improve gradually in the medium term in line with the recovery in infrastructure, investment cycle and overall economy, it said. ICRA expects demand to grow by 6.5-7 percent during FY16 and the pace of recovery in cement industry is likely to mirror the trends in economic recovery.