Indian cement industry to grow by 10 per cent in 2007-08

Indian cement industry to grow by 10 per cent in 2007-08
Published: 23 October 2007

The demand for cement in India is expected to grow by 10 per cent in 2007-08 fiscal driven by housing sector, a senior industry official said.  
 
"The kind of growth we are seeing in Indian economy, the prospects are going to be good as far as cement industry is concerned," OP Puranmalka, Group Executive President  Aditya Birla Group, told reporters here today. 
 
The demand for cement industry would grow by 10 per cent in 2007-08 fiscal against eight per cent compounded annual growth rate (CAGR) of last five years, he said, adding this kind of growth would sustain for the next 2-3 years.  
 
Puranmalka highlighted that housing was a major growth driver, followed by infrastructure projects and said Special Economic Zones could become a major growth area in future.  
 
Asked about possible glut situation by 2009-10 due to huge capacity expansion by cement manufacturers, Puranmalka said "one year there may be a problem. But, these kind of capacity addition is required" to meet the growing demand.  
 
He pointed out that India’s per capita cement consumption was only 136 kg against the global average of 356 kg.  
 
About 75-80Mt of capacity is expected to be added by 2009-10 fiscal.  Aditya Birla Group itself is adding 15Mt of capacity over the next 12 months.  
 
On cement prices outlook, he said the prices are governed by two factors - input cost and demand-supply scenario.  
 
He said there was a demand-supply mismatch in north-west part of the country but in east there was no such gap. 
 
Asked about the likely impact of imported cement on the prices, he said "I do not think there will be any major impact on our pricing".