Growth in cement demand likely to continue in current quarter of ongoing fiscal: Ind-ra
New Delhi: Cement’s demand growth in the country is likely to continue in the current quarter of the ongoing fiscal, according to India Ratings and Research (Ind-Ra).
The total sales volumes of the listed cement makers in the country jumped 9 percent in December quarter of the current fiscal as compared to the same quarter of the previous fiscal.
The high demand and sales in the third quarter was due to continued momentum in rural households and also some traction in infrastructure.
"The strong performance in third quarter of current fiscal stopped the volume fall at 6 percent year-on-year in 9MFY21. Given that the there was low covid-impact in March 2020, Ind-Ra expects continued volume growth in 4QFY21, resulting in an overall decline of about 2 percent year-on-year for current fiscal."
The Eastern Region is expected to see growth in ongoing fiscal. The Central and North Regions have also seen a ‘smooth’ recovery.
"The recovery in the southern region has been slower, given its higher exposure to institutional sales and a prolonged monsoon, though exceptions such as NCL Industries Limited (NCL) and Deccan Cements Limited witnessed double digit growth in 9MFY21."
"Notwithstanding some recovery 3QFY21 onwards, the Western region would decline the sharpest in FY21, given the highest incidence of Covid-19 within the country,", the agency said.
Besides, Ind-Ra said capex completions in FY21 delayed due to Covid-19, bulk of the expected additions for the year would come on stream only in Q4FY21.