Cement Industry Anticipate to Experience 7.5 Percent Increase in Demand
According to a report by Crisil Intelligence, the cement industry is anticipated to experience a 6.5-7.5 percent increase in demand this fiscal year, driven by a 10 percent increase in budgetary allocation for core infrastructure ministries.
Additionally, there is believed to be hope that an above-normal monsoon will increase agricultural profitability, which will in turn lift demand for rural housing.
Due to a slow start to the year due to the general elections, a geographically dispersed monsoon that affected building, and the high base of the previous three fiscal years, cement demand growth in fiscal 2025 was moderate at 4.5 - 5.5 percent.
Urban housing was hurt by a poor real estate market, and project implementation was also slowed by weak state government spending in the first half.
The report also stated that infrastructure, which makes for 29–31 percent of the domestic cement demand, is anticipated to continue to be a major demand driver in the current fiscal year.
Roads have contributed the most to infrastructure, followed by railroads, irrigation systems, and urban infrastructure.
A healthy monsoon season is anticipated to increase agricultural revenue, which will generate house demand.
This indicates that cement consumption will continue to be dominated by rural housing, accounting for an estimated 32–34 percent of total cement consumption.
Additionally, a number of central government programs, including PMGSY and MNREGA, aimed at the rural population, will encourage consumption as a result of increased funding.
Based on the research, the Pradhan Mantri Awas Yojana-Gramin is anticipated to accelerate execution with more under-construction units and a spike in fines. It is anticipated that average rural wages, which rose by 25 percent year over year in fiscal 2025, will continue to be higher this fiscal year.
Also Read: Home-Grown Coffee Brand Leaders Leading the Coffee Culture in India
A low base, interest rate reductions, and improved execution pace under Pradhan Mantri Awas Yojana-Urban are projected to help the urban housing market, which had challenges in fiscal 2025 due to weak real estate, regain impetus in the current fiscal year.