Cement Sector Check - Price Recovery Key For Margin Sustenance: ICICI Securities
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ICICI Securities Report
Our channel checks suggest industry likely saw strong volume growth in excess of mid-teens YoY aided by relatively weak monsoon spell especially in North and West regions during August 2021.
South also likely saw strong growth on a YoY basis owing to low base, while East seems to have declined YoY due to heavy monsoon.
Industry likely operated at ~68% utilisation with ~28 million tonne volumes implying two year compound annual growth rate of ~6%.
Average pan-India prices in Aug-21 fell ~3% month-on-month led by sharp 6-7% month-on-month price fall in East, 3% month-on-month fall in South and 1-2% fall in the rest of India.
However, on a YoY basis, prices are still up 2-4% across most markets except South.
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