Overview
The Indian cement industry is expected to record another year of strong capacity expansion, extending a five-year period of substantial additions. Cement manufacturers are likely to continue establishing new production capacity to meet sustained demand from the real-estate and infrastructure-construction sectors.
The outlook indicates confidence in the industry’s long-term demand prospects, although a related report notes a decline in fresh investment proposals.
Details
Report: Cement Industry to See Robust Capacity Addition
Publisher: Centre for Monitoring Indian Economy (CMIE)—Industry Outlook
Industry covered: Cement manufacturing
Industry outlook: The cement industry is expected to experience another year of substantial production-capacity expansion.
Recent trend: The projected expansion follows five consecutive years of robust capacity additions across the industry.
Manufacturer strategy: Cement producers are expected to continue developing new manufacturing facilities and expanding existing production units.
Primary Demand Drivers
Real estate: Construction activity in the residential and commercial real-estate sectors is supporting demand for cement.
Infrastructure: Continued investment in roads, transport facilities, urban development and other infrastructure projects is contributing to cement consumption.
Capacity-planning rationale: Manufacturers are expanding their production capabilities to serve expected demand from construction-intensive sectors.
Industry confidence: Continued capacity additions indicate that producers remain confident about medium- and long-term cement demand.
Supply outlook: New capacity could improve cement availability and allow manufacturers to serve growing regional and national markets.
Competition: Additional capacity may intensify competition among established manufacturers and newly expanded production facilities.
Investment environment: A related CMIE report titled Fresh Investment Proposals Fall indicates that the broader investment environment may be experiencing some moderation despite the cement industry’s ongoing capacity expansion.
Detailed analysis: The complete analytical report is available through the link provided in the original CMIE Industry Outlook announcement.
Issued by: Samir Athalye, Head—Industry Outlook, Centre for Monitoring Indian Economy.
