Credit Suisse expects improved Indian pricing environment

Credit Suisse expects improved Indian pricing environment
12 March 2013

The Indian cement sector could see an uptick in cement prices in the first quarter of fiscal 2014 with the biggest improvements expected to be in the north, a report on the sector by Credit Suisse has said.

"Cement prices may increase in seasonally strong quarters. Demand pick-up in seasonally strong quarters of March and June should drive accretive price increases for the sector," Credit Suisse said in its research report.

In terms of price improvements by region, the investment bank noted that: "Cement prices in northern India have started recovering after significant decline in the months of November, 2012 to January, 2013.

Maximum accretive price increases are expected in northern India as new supply stress model suggests low supply pressure in two-thirds of Indian cement demand. "Western and Central India have high supply pressure, and accretive price increases are possible if expansions of ABG Shipyard and Reliance are delayed," the report said. The report pointed out that weak demand in northern India has impacted the western region.

"We expect demand to improve post winter in northern India, and elections scheduled in Rajasthan and Delhi, which account for 40 per cent of northern region demand, should also support infrastructure-related demand," the report added.

Published under Cement News

Tagged Under: India Pricing