Domestic cement production during April-December 2017-18 stood at 216.5 million metric tonne (MMT), higher by 2.7 per cent compared to 210.8 MMT during the same period of previous financial year.
For the ongoing fiscal, ICRA said, demand is expected to grow around 3 per cent based on current trends as in December 2017, production increased 8.4 per cent month-on-month to 26.3 MMT.
“This demand growth is bolstered by a pick-up in the housing segment primarily affordable housing, rural housing and higher infrastructure spend,” ICRA Senior VP and Group Head Sabyasachi Majumdar said.
He further said improved rural incomes, higher rural credit and increased allocation for rural, agriculture and allied sectors are likely to boost rural housing demand.
While April-June saw decline in production due to local issues across regions such as sand shortage, implementation of Real Estate Regulatory Authority (RERA) Act and drought, the second quarter saw a decline on the back of GST transitional issues, below average monsoon and continued sand unavailability, the agency noted.
However, in December quarter, output increased 11.6 per cent to 75.6 MMT supported by demand in Andhra Pradesh, Telangana, the eastern (except Bihar) and western markets.