Cement industry to add 150-160 million tonnes capacity by FY28: Report
In response to growing demand from the infrastructure and housing sectors, the cement industry is poised to augment its capacity by 150-160 million tonnes from FY25 to FY28. Over the past five fiscal years, the industry has already added 119 million tonnes per annum, reaching 595 million tonnes per a Crisil Ratings report.
The report notes that this capacity expansion aims to meet the escalating demand and consolidate market share within the highly fragmented and competitive industry. Cement demand demonstrated an 8% growth in fiscal 2022 and a further 12% increase in FY23.
Anticipating the commissioning of 70-75 million tonnes of additional capacity in the next fiscal year, with 50-55% concentrated in the eastern and central regions, the report highlights that major players will contribute 50-55% of the planned capacity increase. However, it cautions that incremental supply and heightened competition may limit price growth, while favorable cost conditions will safeguard and bolster profit margins.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.