Cement demand likely to grow by up to 20 per cent in FY22

According to the rating agency ICRA, cement demand is expected to increase by up to 20 per cent in the next fiscal year with volumes touching FY2019-FY2020 levels. The growth would be supported by rural demand, including affordable housing, and recovery in the infrastructure segment. ICRA expects cement demand to increase by 18-20 per cent in FY2022 over FY2021 with the volumes reaching back to around FY2019-FY2020 levels. The volume growth is also likely to support operating margins in FY2022 at around 20 to 21 per cent, notwithstanding some cost-side pressures. Capacity additions are expected to get back to around 20-22 mn tonne per annum in FY2022 from around 15-17 MTPA in FY2021.