Cement demand set to rise 7% this fiscal, prices by 2-4%: Crisil
New Delhi: The cement sector is expected to see a 6.5-7.5 per cent demand growth this fiscal driven by a 10 per cent rise in budgetary allocation for core infrastructure ministries and on expectation that an above-normal monsoon will boost agricultural profitability, in turn lifting rural housing demand, according to a report by Crisil Intelligence.
In fiscal 2025, cement demand growth was moderate at 4.5-5.5 per cent owing to a sluggish start to the year because of the general elections, spatially well-distributed monsoon that impacted construction along with high base of past three fiscals.
Weak state government spending in the first half also slowed pace of project execution and a slow real estate market impacted urban housing.
Infrastructure, which accounts for 29-31 per cent of the domestic cement demand, is expected to remain a key demand driver in the current fiscal too, the report added.
Within infrastructure, roads have been the largest contributor, followed by railways, irrigation and urban infrastructure.
Sehul Bhatt, Director, Crisil Intelligence, said, "Notably, budgets of 12 states, accounting for 63-65 per cent of Indian cement demand, reveal a substantial 11 per cent increase in total allocations for the current fiscal. Furthermore, the government's emphasis on establishing specialised rail corridors for the energy, mineral and cement industries, along with initiatives to promote tourism, is expected to bolster demand. The enhanced investment is expected
to stimulate cement demand, driving growth of 7.5-8.5 per cent from the infrastructure sector."
According to the report, the rural housing will continue to dominate cement consumption, with an estimated share of 32-34 per cent, as a heathy monsoon season is expected to boost agricultural income, which will create housing demand. In addition, several schemes by central government such as PMGSY and MNREGA targeted towards rural segment will also support consumption due to higher budgetary allocation.
The pace of execution is expected to pick up under the Pradhan Mantri Awas Yojana - Gramin, with a rise in sanctions and more under-construction units, as per the report. Average rural wages, which are estimated to have increased 25 per cent on-year in fiscal 2025, are expected to remain on the higher side this fiscal too.
The urban housing segment, which faced headwinds in fiscal 2025 due to sluggish real estate, is expected to regain momentum in the current fiscal, owing to a low base, interest rate cuts and improved execution pace under Pradhan Mantri Awas Yojana - Urban.
The allocation for the scheme is up by a substantial 45 per cent in the Union Budget 2025-26.
The industrial and commercial segment, which accounts for 13-15 per cent of the domestic cement demand, is expected to see a steady growth this fiscal, driven by traction from commercial real estate and warehousing.
Following three years of strong growth, the segment had slowed down in fiscal 2025 owing to moderation in private capex growth.
Sachidanand Choubey, Associate Director, Crisil Intelligence, said, "A demand surge is anticipated across segments, driven by increased capex allocations for infrastructure and housing ministries. This uptick is expected to support a price rise in fiscal 2026, following a two-year lull. Although competition for market share remains fierce, we estimate a modest 2-4 per cent price increase as companies focus on improving realisations."
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Observer
5 days ago
- Observer
Passenger traffic at Oman's airports reaches 4.7 million
MUSCAT: Passenger traffic across the Sultanate of Oman's airports reached just over 4.7 million by the end of April 2025, representing a 4.1% decline compared to the same period in 2024, according to preliminary data from the National Centre for Statistics and Information (NCSI). Muscat International Airport handled 4,222,789 passengers during the first four months of the year, down 4.7% from 4,428,726 recorded in the corresponding period of 2024. The number of flights also fell sharply, totalling 29,731, an 8.6% decline from 32,520 flights during the same period last year. In contrast, Salalah Airport posted positive growth, registering a 6.8% rise in passenger numbers to 458,394, up from 429,181 a year earlier. However, the number of flights dipped marginally by 0.2% to 2,974, compared to 2,980 last year. Sohar Airport saw a dramatic contraction in activity. Passenger numbers plunged by 98.7% to just 307, compared to 23,842 in the same period of 2024. The number of flights also declined sharply, falling by 62.5% to 72 flights. At Duqm Airport, both passenger and flight numbers saw slight decreases. Passenger traffic dropped by 2.7% to 19,565, while flight movements edged down by 1.9% to 204. As for passenger nationalities at Muscat International Airport in April 2025, Indian nationals topped the list with 182,628 passengers, comprising 99,163 arrivals and 83,465 departures. Omanis followed with a total of 101,087 (45,072 arriving and 56,015 departing), while Pakistani nationals accounted for 47,078 passengers (25,426 arriving and 21,652 departing). — ONA
Observer
5 days ago
- Observer
Work-life balance: myth or reality?
The dynamic business landscape, emerging work patterns, job insecurity, the pressure of automation, the threat of artificial intelligence, and workplace competitiveness have blurred the lines between work and life for millions of professionals globally. While 60% of employees worldwide report having a healthy work-life balance, burnout remains widespread, with 82% of workers at risk and rates continuing to rise. Many professionals scorn, ridicule, and perceive the work-life balance as non-existent. There are two opposing schools of thought on this global dilemma of the workplace cauldron. One perspective stems from the belief that work-life balance is an unattainable myth. It states that work and life are deeply intertwined, exacerbated by the flux of work patterns and artificial intelligence. The second perspective is that work-life imbalance is a reality, and it can be resolved with leader interventions, policy shifts, and attitudinal transformations. Work-life balance is at the core of the sustainable future of work and organizational productivity. While burnout is a global phenomenon prevalent across all sectors, the healthcare, technology/IT, finance, and education sectors are at higher risk due to demand for long hours, high emotional calls, and chronic understaffing, which are some burnout drivers. In most European countries, work weeks are shorter, vacation policies are more generous, and there is a stronger emphasis on leisure and family time. Many of these countries are ranked higher for their work-life balance. Many European countries have also enacted legislative rules and laws granting employees the right to disconnect from work outside official working hours. France, Belgium, Portugal, Italy, Iceland, Greece, Cyprus, Slovenia, and Slovakia have laws that protect employees' mental health and promote a culture of work-life balance. In the Middle East, the burnout rate is lower at 43%. In contrast, Asian countries like India, China, Japan, and South Korea often prioritize long working hours and dedication to work. India reports 62% burnout, which is 3 times the global average. China stands at 58% with a "996 culture" from 9 am to 9 pm, six days a week. Recently, a leading Indian IT business leader, Narayan Murthy, has been criticized and shunned by the public and media for their outrageous suggestion that a 70-hour working week is necessary for Indian global competitiveness. Leaders also released similar comments from other industries, like L&T leader SN Subramanyam, who suggested employees work 90 hours per week, which sparked outrage and criticism from professionals and leaders across all walks of life. These are signs of burnout, mental health risks, and productivity decline. Japan was traditionally known for a culture of workaholism. Traditionally, Japan was known for this approach of "live to work" national culture and "Karoshi," which means death by work. However, Japan has embraced the "work to live" culture since a decade and is making significant policy and national behavior changes to maintain a healthy work-life balance. This cultural shift in Japan is driven by younger generations who prioritize life over work. Australia and New Zealand were traditionally recognized for work-life balance due to their job climate, security, annual leave, and focus on well-being. However, recent assessments indicate that both countries face deteriorating work-life balance and increasingly toxic work environments. Intriguingly, the US also struggles with work-life balance: 66% report officially having difficulty, and 77% of the working population experience burnout. Similarly,79% to 92% of UK workers have experienced burnout at some point in their careers. Work-life balance is complex, evolving, and intensely influenced by nations, technology, and individual perceptions. Whether the readers believe it is a myth or a reality, the world needs to move toward a balanced work-life synchronization for the sustainability and well-being of humankind.
Observer
7 days ago
- Observer
India orders inspection of Boeing 787s after Air India crash
AHMEDABAD/NEW DELHI: India's aviation regulator has ordered all Boeing 787s being operated by local carriers to be inspected after an Air India crash killed 270 people this week, the aviation minister said on Saturday, adding the authorities were investigating all possible causes. The aviation regulator on Friday ordered Air India to conduct additional maintenance checks on its Boeing 787-8/9 aircraft equipped with GEnx engines, including assessments of certain take-off parameters, electronic engine control tests and engine fuel-related checks. "We have also given the order to do the extended surveillance of the 787 planes. There are 34 in our Indian fleet," aviation minister Ram Mohan Naidu told a media briefing in New Delhi. "Eight have already been inspected and with immediate urgency, all of them are going to be done." He did not say whether government officials will be involved in the inspections. The Boeing 787-8 Dreamliner with 242 people on board bound for Britain's Gatwick Airport began losing height seconds after take-off on Thursday and erupted in a fireball as it hit buildings below, in what has been the world's worst aviation disaster in a decade. Air India operates 33 Boeing 787s, while rival airline IndiGo has one, according to data from Flightradar24. IndiGo did not respond to a request for comment. In a statement, Air India said it is currently completing the one-time safety checks directed by the Indian regulator, adding that "some of these checks could lead to higher turnaround time and potential delays on certain long-haul routes." The planes, however, have not been grounded, but a source on Friday told Reuters the Indian government was considering that as an option. Naidu also said the government will look at all possible theories of what led to the crash. Air India and the Indian government were looking at several aspects of the crash including issues linked to its engine thrust, flaps, and why the landing gear remained open as the plane took off and then came down, Reuters has reported. At least 270 bodies have been recovered from the site of the crash, Dhaval Gameti, president of the Junior Doctors Association at B.J. Medical College, told reporters. Only one of the 242 passengers and crew on board survived while others were killed as the plane struck the medical college's hostel as it came down. The crisis has cast a shadow on Air India, which has for years struggled to rebuild its reputation and revamp its fleet after the Tata Group took over the airline from the Indian government in 2022. Tata's chairman said on Friday the group wants to understand what happened, but "we don't know right now." Naidu said a government panel was investigating the crash and will issue a report within three months. "We are going to improve every necessary thing that is going to come our way, to improve the safety," he said at the briefing, declining questions from journalists. LONG WAIT FOR FAMILIES Dozens of anxious family members have been waiting outside an Ahmedabad hospital to collect bodies of loved ones killed in the crash, as doctors were working overtime to gather dental samples from the deceased to run identification checks and DNA profiling. Rafiq Abdul Hafiz Memon, who lost four relatives in the incident, said he was not getting any answers from authorities and was "very hassled". "We have lost our children ... we are not understanding anything. Please help us get information about our children. Tell us when they are going to release their bodies," Memon said. Another father was upset about not being able to get the body of his son, Harshad Patel, saying he was told by authorities it will take 72 hours for DNA profiling. "The authorities are trying to help but our patience is running out," he said. Most bodies in the crash were badly charred and authorities are using dental samples to run identification checks. Jaishankar Pillai, a forensic dentist, told reporters on Friday they had the dental records of 135 charred victims, which can then be matched through reference to victims' prior dental charts, radiographs or other records. Even for doctors, things are getting difficult, as the plane struck a hostel building of the B.J. Medical College, where many of the dead are undergoing identification checks. "Most of us are struggling with our emotions and are mentally disturbed because of the loss of friends and colleagues," said one doctor who did not wish to be named. "The loss of so many colleagues and friends in this incident is difficult."
