Cement demand to grow 6-7.5% in FY26 amid the recovery in infrastructure and housing: Report

The Indian cement industry is expected to witness demand growth of 6–7.5% in FY26, driven by consolidation-led discipline and strong momentum in the infrastructure and housing sectors, according to a report by Systematix Research. The sector ended FY25 on a stronger note, with cement volumes rising 11% after a sluggish first half, aided by increased government capital expenditure and a ramp-up in project execution. Industry capacity stood at approximately 655 million tonnes per annum, a 4.8% YoY increase. Price hikes of Rs. 5-10 (US$ 0.058-0.12) per bag were attempted across regions in May 2025, though absorption varied due to weak demand influenced by factors such as early monsoons in the East and heat waves in the South.
Regionally, the East experienced a sharp drop in demand despite a Rs. 46 (US$ 0.54) per bag price rise, while the South saw flat demand, postponing price increases to the second quarter of FY26. Central India recorded a modest Rs. 2 (US$ 0.023) per bag increase, and the North saw better traction with hikes of Rs. 20–30 (US$ 0.23- 0.35) per bag. Overall, the average cement price in India rose 1.6% MoM in May 2025, reaching Rs. 367 (US$ 4.29) per bag. The industry's positive outlook for FY26 is supported by a favourable cost environment and improved capacity utilisation, signalling a more stable and profitable phase ahead.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.