Given tepid demand due to monsoon, festivities weighing on construction activity, a lull in pricing will prevail for some months ahead
All eyes are on demand expansion and input costs mainly petcoke prices
The big support for cement demand comes from government capex, which is likely to be robust this fiscal (FY2026)
Large capacity additions and market consolidation could see higher supply in the market that will weigh down cement prices
Although the industry anticipates an upward trend in cement prices, driven by rising rural consumption supported by improved farm cash flows, executives caution that intensifying competition could limit significant price gains.
Dealers have increased prices by Rs 5-10 per bag in western India, and by about Rs 20 per bag in northern India. On a lower base, prices in eastern and southern India have also increased by Rs 30-40 per bag, according to cement dealers.
Cement prices are expected to be lower in the next fiscal by up to 3 per cent. The correction is likely to happen, as large players continue to consolidate and expand production in a bid to secure a larger market share.
Although prices have bounced back from lows it is unlikely that they will go so high that companies can clock huge profit margins
Cement manufacturers tried to hike prices in April and May but did not succeed
Aggressive volume push at the expense of pricing resulted in an about 6% sequential decline in cement prices to Rs 370- Rs 375 on average per 50 kg bag in the fourth quarter.
There is optimism that prices would go up but at the same time when newer capacities come in, there will be pressure on prices, correction will happen, says Sanjay Ladiwala, Cement Stockists and Dealers Association of Mumbai. This volatility is likely to continue for the next six months.
CREDAI Chairman Lalit Kumar Jain said cement prices have gone up by about Rs 60-70 per bag across the country in last one week. "We feel that there is a cartel. We are considering moving CCI. We are currently taking legal advice," he added.
According to dealers, cement prices are expected to remain firm in the coming days, which is important to cover the costs as volumes are not supporting and falling continuously due to monsoon arrival in the country, says ICICIdirect.com.