Cement prices surged the most in northern India in Q3. Is there space for more?

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Subscribe to enjoy similar stories. After a lull, trade cement prices at an all India-level are gradually climbing in the recent months. But the recovery in prices is not broad-based.

The northern region saw the highest sequential price improvement of ₹8 per bag in the December quarter (Q3FY25) to ₹350, according to Nomura Global Markets Research. In January so far, trade cement price in this market improved by ₹3 per bag month-on-month to ₹360, said the Nomura report dated 6 January. In the trade segment, cement is sold by companies to dealers, who in turn sell the product to consumers.

The sequential rise in cement prices would provide an uptick to the realizations of cement companies in Q3FY25 with meaningful exposure to the north. Ambuja Cement Ltd, ACC Ltd, Nuvoco Vistas Corporation, Shree Cement Ltd and UltraTech Cement Ltd are seen as beneficiaries. Also Read: Cement's growth surge: 50% CAGR projected by 2027 – Are these stocks ready? “On an average, for cement companies under our coverage realizations are likely to improve by 1.6% sequentially in Q3FY25.

But north-focused companies are better placed than many other regions due to sharp price hikes and poised to clock average sequential realizations growth of 2.5% in Q3FY25," said Mangesh Bhadang, senior vice-president, Centrum Broking Ltd. Cement demand prospects are likely to further improve in a seasonally strong March quarter (Q4) driven by increased government spending on infrastructure projects and ramp-up in construction and home-building activities as peak construction season starts. That, coupled with higher Q3FY25 exit prices, is expected to translate into more price hikes, especially in the north going ahead.