Cement’s Demand Has Improved, But Pricing Remains Muted: Motilal Oswal 
A man sits atop bags of cement on a truck. (Photographer Prashanth Vishwanathan/Bloomberg)

Cement’s Demand Has Improved, But Pricing Remains Muted: Motilal Oswal 

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Motilal Oswal Report

Our channel checks indicate the seasonal uptick in cement demand is playing out, with volumes bouncing back strongly from the weakness seen in the first few weeks of January.

While prices have improved 1–2% month-on-month in North and West, average pan-India price is down 2% QoQ thus far in Q4 FY21 (up 1% YoY).

Cost inflation is also a concern in the near term as petcoke, coal, and diesel prices are up 71%, 4%, and 26% YoY, respectively. Therefore, we expect margins to decline sequentially for the industry, but they should still be higher YoY.

We expect our coverage Ebitda to grow more than 20% YoY in Q4 FY21, driven by ~18% YoY growth in volumes.

Click on the attachment to read the full report:

Motilal Oswal Cement Sector Update.pdf


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