+
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
Real Estate

Shriram Properties Launches ‘Codename: The One’ in Bengaluru

Shriram Properties (SPL), a leading real estate developer focused on the mid-market and mid-premium segments, has announced the launch of its latest residential project under the banner “Codename: The One” in Bengaluru’s Electronic City corridor. This feature-rich gated community will offer 340 spacious 2- and 3-BHK residences, with a total saleable area of approximately 5 lakh square feet and an estimated revenue potential of over Rs 3.5 billion. The project is expected to be developed over a span of more than three years.  Strategically located near the Bommasandra Metro stat..

Next Story
Resources

India Warehousing Show 2025 Closes with Strong Global Presence

The 14th edition of the India Warehousing Show (IWS) 2025 concluded successfully at Yashobhoomi (IICC), Dwarka, drawing participation from over 300 exhibitors across 15 countries and welcoming 15,000+ visitors. Recognised as India’s leading platform for warehousing and logistics excellence, IWS 2025 offered a comprehensive display of cutting-edge automation, sustainable warehousing solutions, and next-gen supply chain technologies. The show was inaugurated by Shri Pankaj Kumar, Joint Secretary – Logistics, DPIIT, Ministry of Commerce and Industry, Government of India. In his opening a..

Next Story
Equipment

MHIET Launches 450kW Gas Cogeneration System with H₂ Co-Firing

Mitsubishi Heavy Industries Engine & Turbocharger (MHIET), part of the Mitsubishi Heavy Industries Group, has launched a new 450kW gas cogeneration system, the SGP M450, jointly developed with Toho Gas Co.,. The system supports hydrogen co-firing at up to 15 vol per cent, with no loss in performance or reliability.  The system is currently available in the Japanese market, and has been developed from the existing GS6R2 city gas engine platform. Key modifications were made to the fuel gas and engine control systems to enable hydrogen co-firing.   Verified through de..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?