Indian cos maintain 8% despatch growth

Indian cos maintain 8% despatch growth
Published: 13 March 2009

According to latest updates from the Cement Manufacturers’ Association (CMA), the Indian cement industry despatched 16.02Mt of cement in February, up 8.39 per cent, compared with 14.78 Mt in the same month last year. Production during the month stood at 15.96Mt as against 14.73Mt.

Hari Mohan Bangur, president of CMA, told Business Standard that demand for cement from non-metro regions was good and, in the current month, despatches’ growth rate would be somewhere around 10 per cent.

In October last year, despatch growth had come down to as low as four per cent. However, from November onwards, the situation took a dramatic turn with demand pouring in and despatches going up. Amrit Lal Kapur, managing director of Ambuja Cements, said that the company’s sales were more than its despatches. Analysts tracking the cement sector said the demand should sustain till monsoon.

"Since this is the peak period for the construction sector, demand for cement will sustain, and so will the prices. We expect the industry to perform well in the current quarter as well as the next one," an analyst with one of the country’s leading infrastructure development and finance companies said on condition of anonymity.

He maintained that, at present, most pending projects are on track for completion. Moreover, the upcoming general election is also stoking demand for cement as the government is trying to wind up its projects, the analyst added.