As post-covid demand cements itself, this sector is eyeing a shift in gears
Crisil, 50-55% of all the capacity additions expected to be commissioned in 2024-25 will be by large players. Scale advantage The average quarterly Ebidta per tonne of cement (essentially, operating revenues minus operating cost) has increased from ₹600 in 2022-23 to ₹765 in 2023-24.
This is still lower than ₹926 in 2021-22, according to IDBI Capital. This has placed smaller players at a disadvantage relative to their larger peers.
"Skyrocketing energy costs over the last two fiscals hurt profitability and balance sheets of players. This led to consolidation in the sector as large players acquired those struggling to compete amid high costs," Crisil said in a recent report.
As per Crisil, the capacity share of large players has increased from 45% in 2017-18 to 48% in 2022-23, partly due to mergers and acquisitions. Consolidation is expected to continue, as producers seek more pricing power.
Companies reportedly increased the price of a 50-kg cement bag by ₹10-15 earlier this month, and further hikes could be in the offing after the elections. www.howindialives.com is a database and search engine for public data.
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