As demand for cement is likely to pick up after the monsoon, prices are expected to go up during the fiscal as there are more infrastructure projects coming up in the country. Despite an excess capacity of 99 million tonne cement in the industry, it is expected prices of the key building material will rule high with demand at 249 mt and installed capacity much higher at 348 mt.
Growth in cement demand is likely to remain at around 6 per cent during this year. In the past couple of years, consumption grew at a compounded annual growth rate (CAGR) of 5.6 per cent, say analysts.
CARE Research, a division of CARE Ratings says that domestic demand is expected to grow at a higher CAGR of 7.9 per cent in 2012-16, with focus on infrastructure development and low-cost housing likely to keep the long-term demand for the commodity intact.