Cement Sector Update - Demand Weak, But Prices, Margins Strong: Motilal Oswal

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Motilal Oswal Report

Cement's demand has been impacted severely by the lockdowns, and our checks indicate a 40–60% decline in demand across regions in May (versus 20–30% decline in April).

Unlike last year, trade demand this time around has been more adversely impacted and is down 60–70% (vis-a-vis 30–40% for non-trade).

While we expect demand to improve in June as the lockdowns ease gradually, Q1 FY22 should still see 30–35% QoQ decline in volumes (still up 10–15% YoY on a low base due to the lockdowns implemented last year).

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