Business EconomyPosted at: Nov 8 2024 5:12PM


Fall in cement prices hits performance of India Cements

Chennai, Nov 8 (UNI) Cement major India Cements on Friday said
the performance of the company for the quarter and half year ended
September 30, 2024, was adversely affected due to a free fall in
cement prices.
Though the operating performance improved during the second quarter
with an increase in volume by 17% as compared to the first quarter of the
current year, the sharp decline in selling prices resulting in drop in NPR
by 13 per cent impacted the margins resulting in a negative EBIDTA of
Rs.154 crores for the second quarter.
The results were taken on record by the Board of Directors at their meeting
held here today, a company release said.
It said the quarter and the half year under review was very tough for the industry
in general caused by various factors like the prolonged elections in the country
for more than two months in the first quarter, heat waves and floods that hit some
parts of the country etc.
The cement demand as such was very weak and the growth was muted, with
a negative growth in the first quarter and marginal growth of 3% in the second
quarter with an overall of 1.6% growth in April to September as compared to
a growth of over 10% in the previous year as per the information published by
DIPP.
This tepid growth resulted in severe competition for market share causing pricing
pressure and the selling price of cement aberrated particularly in the Southern
Regions where there is a huge supply overhang.
However, with a stable Government at the centre after the elections and with the
renewed focus on infrastructure in the budget with big ticket investment projects,
the expectations are that cement demand may pick up and the experts predict an
average growth of around 7% for this year for cement demand.
This was evident with an improvement in the cement growth of around 7.1% in the
month of September.
The increase in cost pressure was moderated due to fuel price remaining almost
constant and lower than the first quarter giving some relief for some margin for the
industry.
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