Cement demand to grow by 8% next year: ACC

Written by Press Trust of India | Mumbai | Updated: Aug 31 2009, 06:02am hrs
Cement manufacturer ACC on Sunday said demand would pick up by 8% next one year, led by housing, retail and infrastructure sectors, but monsoon failure could have an adverse impact.

We continue to maintain an encouraging outlook for the industry in the future based on positive gains of growth in demand, led by housing, retail and infrastructure sector. We expect that demand for cement consumption will grow at around 8% at least for the next one year, ACC managing director Sumit Banerjee said.

During the first half of the current year, cement industry witnessed growth of almost 11% compared to the corresponding period last year.

If the demand grows at a healthy pace, then we can assume prices are also likely to remain generally stable till next year, with some seasonal fluctuations, Banerjee said. He said the failure of monsoon, if it happens, would have a delayed and indirect impact on future consumption.

A deficit monsoon will pose a serious threat to the rural economy. In such a case, we may have to focus on the growth of the infrastructure segment, he said.

India's per capita cement consumption is 156 kilograms against China's 600 kilograms. The countrys total cement production in the last year was 227 million tonne and fresh capacity of around 48 million tonne is expected in the current year.

ACC has embarked on a Rs 3,000-crore expansion for taking cement production capacity to 30 million tonne by mid-2010 from 22.63 million tonne now. The company is in the midst of drawing up ambitious plans for the next stage of capacity addition, which might come through both greenfield and brownfield expansions. ACC is the largest cement manufacturer in India with 12% market share.