India: Cement sales up on realty, infra push

If the production and sales figures of cement companies for December are anything to go by, the industry could see a healthy demand from the realty and infrastructure sectors in what remains of the current fiscal.

Ambuja Cement, the third-largest cement maker, witnessed four per cent rise in dispatch to 17.29 lakh tonnes in December compared to a year-ago period. The production also climbed to 17.37 lakh tones from 16.28 lakh tones in December 2008.

Delhi-based Jaiprakash Associates registered a 60 per cent increase in sales in December at 10.5 lakh tonnes. By comparison, the company had sold 6.6 lakh tonnes cement in December 2008. For the first nine months of FY10, it sold 74.5 lakh tonnes against 54.4 lakh tonnes in the corresponding period of last fiscal.

Shree Cement, the largest cement manufacturer in northern India, saw its shipments rise 22.4 per cent to 8.58 lakh tonnes, up from 7.01 lakh tonnes a year earlier. It has a capacity of 9.5 million tonnes and its plants are situated in Rajasthan. The total shipments during the April-December period rose 24.6% to 6.77 million tonnes, up from 5.43 million tonnes for the same period of 2008.

The Indian cement industry, which has a total capacity of 240 million tonnes, is growing at 7-8 per cent each year, making it the second-fastest after China. The robust consumption pattern, as it is evident from the Indian company sales figures, led to increase buying in shares of cement companies.

On Monday, ACC saw its stock rise 4.7 per cent to Rs 913.6 at the BSE. Ambuja Cements, a unit of the world??s second-largest cement maker Holcim, climbed 1.8 per cent to Rs 106.1.

Importantly, ACC's sales fell to 1.88 million tonne in December, against 1.90 million tonne in the same period last year. The company, in which Swiss cement maker Holcim holds more than a 46 per cent stake, said production fell to 1.86 million tonnes from 1.91 million tonnes a year ago.

From China Cement (2010-1-5)