Cement prices in September increased steadily after a damp August season. So far, this October saw the trend continuing in most regions of the country. This phenomenon was witnessed in Andhra Pradesh.
All India prices at Rs 299 per 50 kg bag, was up 1.7 per cent on a month-on-month (mom) basis. The discipline in pricing among the cement makers has helped the prices to improve on the back of a higher supply relative to demand. This phenomenon has helped the companies post good results in the past few quarters.
The northern region saw a hike of 2.6 per cent mom in prices due to increasing demand from areas such as Delhi, Haryana and Chandigarh. The only area of concern is Punjab where sand mining issue has led to lower availability of sand.
Central region saw a hike of 4.3 per cent in prices mainly from the cities of Madhya Pradesh. Demand in Uttar Pradesh has been more or less constant. The price per bag stands at Rs 289 per bag. Prices in eastern and western regions have remained constant and declined respectively, primarily on account of the ongoing festive season. Dealers expect the prices to rise in the coming months due to increasing demand post the festive season.
Andhra Pradesh, which has been a not-so-profitable region for cement makers, was a pleasant surprise for the industry as the region saw an increase of 4 per cent in cement prices mom after new entrants like JSW and Jaypee slashed prices in September to capture market share.