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Cement Sector Check - Temporary Weakness In Demand; Prices Should Improve Further In Q4: Motilal Oswal

Cement Sector Check - Temporary Weakness In Demand; Prices Should Improve Further In Q4: Motilal Oswal

Workers load sacks of cement onto trucks in Bihar.(Photographer: Anindito Mukherjee/Bloomberg)
Workers load sacks of cement onto trucks in Bihar.(Photographer: Anindito Mukherjee/Bloomberg)

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Motilal Oswal Report

Cement demand has not yet picked up after the festive season, and sales volume in November 2021 seems to be 18-20% lower than October 2021 levels and against its historical average of a 6% month-on-month decline in November.

Few stockists/marketing personnel attribute the decline in demand to unseasonal rainfall in many parts of the country, continued sand crisis in the East region and Eastern Uttar Pradesh, auspicious marriage season after the Covid-19 outbreak last year, better volumes in Oct-21 on expectations of price hikes, and sudden price hikes.

With the onset of the busy construction period (December-March), we expect demand to recover going forward.

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Motilal Oswal Cement Sector Update.pdf

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