Indian cement industry growth expected to slow in FY24-25

India's cement industry is projected to experience a slower growth rate of 7-8 per cent this fiscal year, reaching 475Mt, according to a Crisil report. This marks a slowdown from the double-digit growth recorded in the last two financial years. The first half of FY24-25 saw modest growth of just three per cent, attributed to a prolonged heatwave and labour shortages due to general elections.

However, the second half is expected to see improved performance, driven by a revival in rural housing demand and increased government spending on infrastructure projects. Despite the slower growth, cement makers are expected to maintain operating profitability at INR975-1000/t (US$11.60-11.89/t), above the decadal average. The report highlights that steady profitability and projected volume growth should keep cash accruals and credit profiles stable for cement producers, though any dip in construction activity or a rise in energy costs could pose risks to the sector’s outlook.