Economy & Market
Cement prices may come down
Analysts say that there is an apprehension of price cuts and expected discounts from cement majors to push their sales as rains and poor sales in August have taken a toll on the cement counters.
All-India average cement prices, which hit an all-time-high in mid-July at Rs 314 for a 50-kg bag, have declined over five per cent since then. The current retail price stands at Rs 295 a bag. Experts say in September there could be a further fall in the range of Rs 5-10 per bag.
Cement dealers say that the sales in late August was hit by an expected fall in prices as rains intensified. Normally, during the monsoon, cement stocks tend to trade weak as companies lose their pricing power amid demand slowdown. This year too, cement shares moved northwards as long as there was deficient rainfall.
Further, both the companies of Swiss major Holcim - ACC and Ambuja - did poorly in terms of sales in August. ACC reported a decline of 6.92 per cent in its dispatches at 1.75 million tonne (mt) against 1.88 mt in the previous year corresponding month.
Ambuja, however, did comparatively better as its sales dipped 2.36 per cent to 1.45 mt, compared with 1.48 mt in the same month last year. Holcim controls a little less than one-fifth of India's cement market.