Cement prices in north, east, west and central India have fallen on a month-on-month (m-o-m) basis. Average cement prices in the north fell nearly 2-3 per cent m-o-m; in Delhi, the fall was to the extent of Rs 20-25 per bag. In the eastern region, prices dipped by around Rs 5-10 per bag, said a recent Edelweiss Securities Ltd report. The only exception was southern India. Prices in the states of Andhra Pradesh and Telangana have improved recently by around Rs 20-25 per bag over the previous month, an analyst with Reliance Securities said. However, cement prices haven?t dropped as sharply as they had during the same period last year.
For instance, in central India, prices corrected from Rs 270-275 per bag in Q1FY16 to Rs 230-238/a bag during the lean season last year; this year, it has corrected from Rs 300-305 per bag to Rs 270-280 per bag, mainly because of drought conditions prevailing last year.
The price correction gap has narrowed, but the cause for concern is the offtake in terms of volume hasn?t been significant despite the government?s efforts to push infrastructure activities.