India is the second largest cement producer in the world and accounted for over 7% of the global installed capacity. Of the total capacity, 98% lies with the private sector and the rest with public sector. The top 20 companies account for around 70% of the total cement production in India. As India has a high quantity and quality of limestone deposits through-out the country, the cement industry promises huge potential for growth.

India's cement production is expected increased at a CAGR of 5.65% between FY16-22, driven by demands in roads, urban infrastructure and commercial real estate. The consumption of cement in India is expected grow to at a CAGR of 5.68% from FY16 to FY22.

At present, the Installed capacity of cement in India is 500 MTPA with production of 298 MTPA

The Cement sector has received good investments and support from the Government in the recent past.

FDI inflows in the industry, related to the manufacturing of cement and gypsum products, reached US$ 5.48 billion between April 2000-June 2022.

In June 2022, UltraTech Cement approved Rs. 12,886 crore (US$ 1.65 billion) capital expenditure to increase capacity by 22.6 million tonnes per annum (MTPA) through brownfield and greenfield projects.

PE/VC investments in real estate and infrastructure stood at US$ 338 million and US$ 795 million respectively in September 2022.

Cement production in India increased by 12.1% in September 2022 compared to September 2021.

In October 2022, UltraTech announced that it has been granted Environmental Product Declaration (EPD) certificates for four of its cement products, which are Ordinary Portland Cement (OPC), Portland Pozzolana Cement (PPC), Portland Slag Cement (PSC) and PCC (Portland Composite Cement).

As per the Union Budget 2022-23, there was a higher allocation for infrastructure to the tune of US$ 26.74 billion in roads and US$ 18.84 billion in railways is likely to boost demand for cement.

Under the housing for all segment, 8 million households will be identified according Rs. 48,000 crore (US$ 6.44 billion) set aside for PM Awas Yojana.

The government approved an outlay of Rs. 199,107 crore (US$ 26.74 billion) for the Ministry of Road Transport and Highways, and this step is likely to boost the demand for cement.

Several government schemes such as MGNREGA, PM Garib Kalyan Rozgar Abhiyan and state-level schemes such as Matir Srisht (West Bengal) and public work schemes (Jharkhand) have aided demand

In October 2021, Prime Minister, Mr. Narendra Modi, launched the ‘PM Gati Shakti - National Master Plan (NMP)’ for multimodal connectivity. Gati Shakti will bring synergy to create a world-class, seamless multimodal transport network in India. This will boost the demand for cement in the future.

Growth in Infrastructure and real estate sector, post-COVID-19 pandemic, is likely to augment the demand for cement in 2022. The industry is likely to add an ~8 MTPA capacity in cement production.

As per DGCIS, India’s export of Portland cement, aluminous cement, slag cement, supersulphate cement and similar hydraulic cements stood at US$ 118.15 million in FY21. India exported cement to countries such as Sri Lanka, Nepal, the US, the UAE and Bangladesh.

The Government of India is strongly focused on infrastructure development to boost economic growth and is aiming for 100 smart cities. The Government also intends to expand the capacity of railways and the facilities for handling and storage to ease the transportation of cement and reduce transportation cost. These measures would lead to an increased construction activity, thereby boosting cement demand.

The future outlook of the cement sector looks on track with pandemic easing out.

In the next 10 years, India could become the main exporter of clinker and gray cement to the Middle East, Africa, and other developing nations of the world. Cement plants near the ports, for instance the plants in Gujarat and Visakhapatnam, will have an added advantage for export and will logistically be well armed to face stiff competition from cement plants in the interior of the country. India’s cement production capacity is expected to reach 550 MT by 2025. The cement demand in India is estimated to touch 419.92 MT by FY 2027 driven by the expanding demand of different sectors, i.e., housing, commercial construction, and industrial construction.