With increasing consumption in infrastructure and housing sectors, future is bright for the cement industry for the next 10 years, said N Srinivasan, vice-chairman and managing director, India Cements.
With increasing consumption in infrastructure and housing sectors, future is bright for the cement industry for the next 10 years, said N Srinivasan, vice-chairman & managing director, India Cements.
Addressing the members at the 72nd Annual General Meeting in Chennai on Thursday, he said, “After a long time, cement demand is slowly picking up in the south, which has the problem of capacity overhang having 160 million tonne (out of total capacity of 400 to 425 million tonne in the country) against the demand of around 70 to 80 million tonne. This year, with pick up in demand, capacity utilisation in the south is expected to be much better as compared to 70% in 2017-18. Along with volume, cement price is expected to be better in the last quarter of this year.”
He said the plants in north, west, central and eastern regions are already operating almost at full capacity. Last year, capacity utilisation of India Cements was at 71%, which was better than the industry peers in the south. It had substantially improved its operating performance in the first quarter of this year (Apr-Jun) with a capacity utilisation of 80%, against 67% in the same quarter of the previous year. It also expects the second quarter to be better despite the floods in Kerala and transporters’ strike. “This year, we’re seeing good volume and going forward, we’ll be operating almost at full capacity in the fourth quarter (Jan-Mar) of this year resulting in better performance,” Srinivasan told shareholders.
Referring to the capacity expansion in Sankari and Dalavoi plants in Tamil Nadu, he said the firm had not decided yet and it would explore avenues for augmenting capacity after attaining the expected full capacity utilisation.