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Promising signs for India’s cement makers

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World Cement,

India is the second largest cement producer in the world. The increase in demand for cement from housing and infrastructure could provide a boost to its production in India.

For example, NCL Industries and Heidelberg Cement plan to increase their cement production to earn more profits.

The housing sector in India is the biggest demand driver of cement. This accounts up to 67% of the total cement consumption in India. The demand for cement is expected to reach 550 – 600 million tpy by 2025.

NCL Industries has plans to boost its cement production up to 2.7 million t due to increase in demand from the construction and infrastructure sector.

Limestone reservoirs: Andhra Pradesh and Telangana have numerous limestone reserves. This drives the focus of NCL Industries towards increasing its production capacity for the southern market. It also plans to extend its production activity to other areas like Karnataka and Tamil Nadu.

Increase in cement plants: NCL Industries is planning to expand its cement capacity from 2 million tonnes to 2.7 million t by the end of 2016. It also plans to expand the redimix concrete business by setting up plants in Hyderabad, Vizag and Amravati. At present, the company is also working on its Wood Cement Particle Board Plant.

Government spending: Budget 2016-17 allocated Rs 7296 crore towards Urban Rejuvenation Mission – The Smart Cities project. It also allocated Rs 19 000 crore for the Pradhan Mantri Gram Sadak Yojana (PMGSY) for FY17. Such large scale projects would need large tonnes of cement. Higher demand will help cement companies increase their profit. This could also be a motivating factor for cement companies to increase their production capacity.

Road ahead: One cannot ignore the fact that there is no other substitute to cement. ‘In the next 10 years, India could become the main exporter of clinker and gray cement to the Middle East, Africa, and other developing nations of the world’, according to BRICS India 2016 report. The report also states that cement plants in Gujarat and Visakhapatnam will have an added advantage for exports. This could result in a tough competition with other cement plants in other parts of India.

Edited from source by Joseph Green. Source: Aggregate Research

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