Cement sector to see improvement in demand in FY17
Cement

Cement sector to see improvement in demand in FY17

The domestic cement sector is expected to witness improvement in demand due to pickup in construction activities. A healthy improvement in the demand scenario along with a favourable cost environment is likely to have a positive bearing on the fourth quarter (2015-16) performance of cement companies as they are likely to witness earnings improvement of 37 per cent on sequential basis. Cement companies have witnessed an average volume growth of 13 per cent YoY, mainly led by new capacity and demand improvement. It is observed that barring few pockets in the southern and western market, the demand environment has witnessed a decent uptick in the fourth quarter. The northern and eastern regions have witnessed healthier improvement in demand. Notably, northern cement prices have witnessed a sharp recovery of Rs 70-80 per bag in the last two months.

The domestic cement sector is expected to witness improvement in demand due to pickup in construction activities. A healthy improvement in the demand scenario along with a favourable cost environment is likely to have a positive bearing on the fourth quarter (2015-16) performance of cement companies as they are likely to witness earnings improvement of 37 per cent on sequential basis. Cement companies have witnessed an average volume growth of 13 per cent YoY, mainly led by new capacity and demand improvement. It is observed that barring few pockets in the southern and western market, the demand environment has witnessed a decent uptick in the fourth quarter. The northern and eastern regions have witnessed healthier improvement in demand. Notably, northern cement prices have witnessed a sharp recovery of Rs 70-80 per bag in the last two months.

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