After a period of abnormally-high growth, India’s cement sector has begun to moderate and return to normal levels. Meanwhile, rising fuel and power costs have impacted the profitability of the major producers. Furthermore, the country’s capacity utilisation is at risk as new investments may push the supply-demand imbalance further.
India’s economic growth surpassed expectations during the April-June 2018 period (1QFY18-19), rising to a nine-quarter high of 8.2 per cent YoY on the back of a rise in manufacturing activities. Despite the increase in GDP, economists continue to be sceptical of growth sustaining its momentum into upcoming quarters given the challenges of higher interest rates, a weak Indian rupee, rising oil prices and a falling household savings rate.
