Cement margins to remain under pressure in short term

Cement majors, ACC and Ambuja Cements, believe that margins will be under pressure as cement price will remain stable in the short-term owing to glut in the market. As per a Fitch report, cement production capacity was 201.3 mtpa in 2007-08 vis-a-vis the demand of 167.7 mtpa. The capacity went up to 236.9 mtpa in 2008-09 compared to total demand of just 181 mtpa. The agency further stated that the demand-supply imbalance would reach its highest level in 2012-13 to 125.8 mtpa with capacity going up to 392.8 mtpa.