Cement production slumps 12% in Q1 FY22: ICRA report
Cement

Cement production slumps 12% in Q1 FY22: ICRA report

Cement production declined 12% to 82 million tonne (mt) in April-June FY21-22 against the previous quarter as Covid-19 induced lockdowns in several states affected demand, according to an ICRA report.

The output was 54% higher, helped by a lower base on account of nationwide lockdown in April 2020 year-on-year (YoY), the ICRA said.

The cement production in 4M FY2022 is lower by 2% against pre-Covid levels, it said.

Though ICRA anticipates total production in the country to increase by 12% in the current FY, supported by factors like pent-up demand, pick-up in infrastructure activity, and rural housing demand.

ICRA Assistant Vice President & Sector Head, Corporate Ratings Anupama Reddy said that the sales volumes of ICRA's sample witnessed a fall of 20% QoQ due to the impact of the second wave of Covid-19, however, higher by 44% YoY. The net sales realisations observed an increase of 4% YoY and 5% QoQ on the back of the cost hikes taken by cement companies in June quarter 2021-22.

These price hikes are majorly driven by the increase in input costs, mainly power and fuel and freight expenses over the last few months.

While the industry observed cost side pressures, the companies report the highest ever OPBIDTA per mt at Rs 1,372 per mt in Q1 FY22, exceeding the previous peak of Rs 1,306 per mt achieved in Q1 FY2021, Reddy said.

The raw material prices rise due to higher additive prices such as fly ash and inward freight prices due to a rise in diesel costs and the rise in the power and fuel price per mt was due to the increase in coal and pet coke costs. In the June quarter, the coal costs rose by 154% YoY and the pet coke costs by 98% YoY.

Image Source


Also read: Cement prices in August fell by 3% to Rs 328 per 50 kg

Cement production declined 12% to 82 million tonne (mt) in April-June FY21-22 against the previous quarter as Covid-19 induced lockdowns in several states affected demand, according to an ICRA report. The output was 54% higher, helped by a lower base on account of nationwide lockdown in April 2020 year-on-year (YoY), the ICRA said. The cement production in 4M FY2022 is lower by 2% against pre-Covid levels, it said. Though ICRA anticipates total production in the country to increase by 12% in the current FY, supported by factors like pent-up demand, pick-up in infrastructure activity, and rural housing demand. ICRA Assistant Vice President & Sector Head, Corporate Ratings Anupama Reddy said that the sales volumes of ICRA's sample witnessed a fall of 20% QoQ due to the impact of the second wave of Covid-19, however, higher by 44% YoY. The net sales realisations observed an increase of 4% YoY and 5% QoQ on the back of the cost hikes taken by cement companies in June quarter 2021-22. These price hikes are majorly driven by the increase in input costs, mainly power and fuel and freight expenses over the last few months. While the industry observed cost side pressures, the companies report the highest ever OPBIDTA per mt at Rs 1,372 per mt in Q1 FY22, exceeding the previous peak of Rs 1,306 per mt achieved in Q1 FY2021, Reddy said. The raw material prices rise due to higher additive prices such as fly ash and inward freight prices due to a rise in diesel costs and the rise in the power and fuel price per mt was due to the increase in coal and pet coke costs. In the June quarter, the coal costs rose by 154% YoY and the pet coke costs by 98% YoY. Image SourceAlso read: Cement prices in August fell by 3% to Rs 328 per 50 kg

Next Story
Building Material

Protective coatings have powered our double-digit growth

With a stronghold in the decorative segment, Berger Paints India is equally focused on scaling its industrial coatings business – an essential pillar driving its long-term growth and diversification strategy. In conversation with CW, Sanjay Chowdhury, Vice President and Business Head, Berger Paints India, shares how the division is innovating across infrastructure sectors, enhancing sustainability and positioning itself as a solution-driven partner for high-performance, large-scale projects.How does Berger’s Protective Coatings, an industrial coatings division, contribute to over..

Next Story
Technology

L&T Tech Services Wins $50 Mn+ Deal from Global Energy Major

L&T Technology Services, a global leader in engineering and technology services, announced that its Sustainability segment has been selected by one of the world's leading energy companies as its exclusive global engineering partner for Enterprise Data and Digital Services.The five-year agreement, valued at over $50 million, underscores the client’s long-term commitment to sustainability, innovation and digital transformation. This strategic partnership builds on a trusted relationship between the Client and LTTS spanning over a decade.As per the agreement, LTTS will provide Enterprise Da..

Next Story
Infrastructure Energy

ACME Solar Signs PPA with SECI for 300 MW Sikar Project in Rajasthan

ACME Sikar Solar, a wholly owned subsidiary of ACME Solar Holdings, has executed a 25-year Power Purchase Agreement (PPA) with the Solar Energy Corporation of India (SECI) for 300 MW capacity in Rajasthan at a fixed tariff of Rs 3.05 per kWh. This achievement follows the commissioning of 300 MW capacity by ACME Sikar on June 23, 2025.The said bid was won earlier under SECI ISTS XVIII Tranche, and the tariff was formally adopted by the Central Electricity Regulatory Commission (CERC) on 30th May 2025. As per the agreement, the project requires to supply power on or before June 30, 2025. The pro..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?