CLSA remains optimistic about the cement sector, particularly on a potential demand rebound in 2HFY25 and FY26, maintaining a selective preference for Ultratech Cement. Cement prices increased by ₹10–30 per bag in early December, translating to a pan-India price growth of 3.5% quarter-on-quarter, although still 5% lower year-on-year.
The recovery follows a challenging October but showed gradual volume improvement in late November. CLSA forecasts a 4% price increase in 2HFY25, aided by a combination of a sharp volume recovery and cost reduction driven by operating leverage. These factors bolster the sector’s outlook, setting the stage for a stronger growth trajectory in the coming quarters.
