Cement Industry Grapples with Declining Margins Amid Price Drop

Major cement manufacturers saw declining margins in the September quarter due to lower prices, affecting sales realizations. Only giants like UltraTech and Ambuja Cement reported growth, fueled by acquisitions. Challenges included monsoon and weak demand, although costs remained stable. Prices dropped significantly year-on-year.

In the September quarter, major cement manufacturers experienced a drop in margins as prices fell, negatively affecting sales realizations. This downturn was most notable among smaller firms, while larger players like UltraTech Cement and Ambuja Cement reported growth, bolstered by strategic acquisitions.

The extended monsoon season, coupled with flooding and sluggish government demand, contributed to a weak market environment. Despite these challenges, the power and fuel costs have remained largely stable for the industry as a whole.

The average price of cement in India stood at Rs 330 per 50 kg bag in September, marking an 11% year-on-year decline. However, industry leaders maintain cautious optimism, expecting market improvements driven by housing demand and increased government investment in infrastructure.

(With inputs from agencies.)