Indian cement demand recovers after lockdown

Indian cement demand recovers after lockdown
26 June 2020

Following the lifting of the coronavirus lockdown in several Indian states, the country’s cement industry is witnessing some pick-up in demand, according to Livemint.

Research into the cement dealers’ channel by various brokers has shown that pent-up demand is supporting capacity utilisation levels with rural areas expected to provide a further rise in sales going forward.

“Rural and pent-up demand has led to higher-than-expected volumes in May-June 2020 and the industry could just suffer nearly 40 per cent YoY decline in 1QFY21E volumes, better than earlier expectations," said a Kotak Institutional Equities (KIE) Ltd.

Housing accounts for about 60 per cent of offtake, followed by infrastructure and commercial projects. However, rural housing is forecast to recover faster than its urban counterpart, where the pick-up could be significantly slower.

However, cement prices appear to be down by three per cent on average to INR369 (US$4.89)/50kg bag in June 2020.

Published under Cement News