A slowdown in demand from key cement consuming sectors is likely to push the industry’s growth below eight per cent in June. Though the industry statistics will be released next week, the initial numbers from cement majors signal a remarkable decline in demand.
According to analysts, demand slowdown from infrastructure and real estate segments, coupled with decline in demand in the North due to the Commonwealth Games in New Delhi, will make it tough for the industry to maintain a growth rate of above eight per cent in June.
For instance, Ambuja Cements, part of Swiss major Holcim, had only a 6.2 per cent rise in sales during the month. ACC, the sister concern, continued its dull performance with sales of 1.78 million tonnes, down 1.7 per cent YoY.
Shree Cement, a northern major, surprised analysts with a flat rise of 1.4 per cent in sales, at 0.79Mt against 0.77Mt in the corresponding month last year.
However, Jaiprakash Associates continued its robust growth in June on the back of newer capacities. Sales were 65 per cent higher at 1.32Mt, against 0.8Mt last year in the same month.
Experts said ACC’s continuous dull sales numbers were surprising, as the company had increased its capacities. “Despite adding newer capacities, ACC’s sales are below than last year’s,” said an analyst with a domestic brokerage firm.