Indian cement: gradual improvements expected

Financial services firm Motilal Oswal Securities has said it is expecting a gradual improvements in the Indian cement sector which is starting to overcome recent challenging times.

In a recent research note, the house stated:  “We believe that the worst is over for the Indian cement industry and expect gradual improvement in operating performance. Volume recovery (~8% growth in FY13) coupled with slowdown in capacity addition would drive absorption of excess capacity.

"While cement prices are likely to remain buoyant at least till 1QFY13, short-term volatility due to seasonality notwithstanding, we expect improvement in cement prices and profitability on an annual basis for the next 2-3 years.”