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Demonetisation and After | Positive Outlook

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Vaibhav Agarwal visited north India to assess the impact of the government’s radical move on the region’s cement industry.

We visited cement manufacturers, channel partners, builders and contractors in north India for an update on the situation and outlook after the government’s demonetisation move.

The channel mechanism in north India is very different from the south; channel partners aren’t as happy, and this is a key reason for price volatility in this region. Even so, most partners sounded positive, especially on demand. A majority of them said that pricing is bound to improve in the region and that all players, including the large northern majors, appear to be in favour of better prices.

Prices should recover steadily in the north over Q4/Q1. The impact of demonetisation is now neutralised. Most of the respondents said that although demonetisation has had an impact, it was much lower than initially anticipated.

North India is a largely cash and carry economy. Most traders either adapted to the situation (accepting payments through bank transfers) or were accepting old currency even after 8 November 2016. In many cases, traders said that a lot of their outstandings were cleared in old currency; a few even recovered written off debts ‘ which kept the cycle up. Most channel partners/dealers we met complained of low net margins irrespective of cement prices. This is one of the key reasons why prices there remain more unstable despite high capacity utilisations.

Also the main reason why most price hikes in the north do not flow through as effectively as they do in the south, is because channel partners simply do not participate in companies’ price hike announcements (a key issue that has remained unaddressed for long).

This segment has also not taken to e wallets and swipe machines and it demands more stringent laws for cheque returns due to the weak channel margin structure in the north. Ergo, almost all partners said that they are not in favour of moving to digital payments.

A 1-2 per cent charge on digital transactions, they say, is a very high cost ‘ one that would take away most of their margins. Barring a few, most dealers didn’t have the mechanism for digital payments. It was said that the largest cement major rolled back the idea of installing swipe machines for channel partners. Trade associations here have approached the government to make laws more stringent for cheque returns, as issuing post dated cheques is the most common business practice there. A change in target customer segments has also helped a few manufacturers.

Smart shift
A few cement manufacturers have made a deliberate and smart shift in focus to accounts within their non-trade sales. These are a sub-segment of non-trade customers where the order flow is more regular, with no payment issues, and no extended credits. We understand that this deliberate shift has helped a few north-based manufacturers (such as JK Cement) to sail through demonetisation better. Construction of toilets and roads are some of the key demand drivers. Almost the entire channel expects prices to be up by a minimum (net) of Rs 25/bag over H1CY17.

We reiterate JK Cement as our top northern pick. Other companies like JK Lakshmi Cement, and Mangalam Cement are also attractive bets. Shree Cement will continue to command a premium due to its ability to perform well in all scenarios.

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Concrete

India Sets Up First Carbon Capture Testbeds for Cement Industry

Five CCU testbeds launched to decarbonise cement production

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The Department of Science and Technology (DST) recently unveiled a pioneering national initiative: five Carbon Capture and Utilisation (CCU) testbeds in the cement sector, forming a first-of-its-kind research and innovation cluster to combat industrial carbon emissions.
This is a significant step towards India’s Climate Action for fostering National Determined Contributions (NDCs) targets and to achieve net zero decarbonisation pathways for Industry Transition., towards the Government’s goal to achieve a carbon-neutral economy by 2070.
Carbon Capture Utilisation (CCU) holds significant importance in hard-to-abate sectors like Cement, Steel, Power, Oil &Natural Gas, Chemicals & Fertilizers in reducing emissions by capturing carbon dioxide from industrial processes and converting it to value add products such as synthetic fuels, Urea, Soda, Ash, chemicals, food grade CO2 or concrete aggregates. CCU provides a feasible pathway for these tough to decarbonise industries to lower their carbon footprint and move towards achieving Net Zero Goals while continuing their operations efficiently. DST has taken major strides in fostering R&D in the CCUS domain.
Concrete is vital for India’s economy and the Cement industry being one of the main hard-to-abate sectors, is committed to align with the national decarbonisation commitments. New technologies to decarbonise emission intensity of the cement sector would play a key role in achieving of national net zero targets.
Recognizing the critical need for decarbonising the Cement sector, the Energy and Sustainable Technology (CEST) Division of Department launched a unique call for mobilising Academia-Industry Consortia proposals for deployment of Carbon Capture Utilisation (CCU) in Cement Sector. This Special call envisaged to develop and deploy innovative CCU Test bed in Cement Sector with thrust on Developing CO2 capture + CO2 Utilisation integrated unit in an Industrial set up through an innovative Public Private Partnership (PPP) funding model.
As a unique initiative and one of its first kind in India, DST has approved setting up of five CCU testbeds for translational R&D, to be set up in Academia-Industry collaboration under this significant initiative of DST in PPP mode, engaging with premier research laboratories as knowledge partners and top Cement companies as the industry partner.
On the occasion of National Technology Day celebrations, on May 11, 2025 the 5 CCU Cement Test beds were announced and grants had been handed over to the Test bed teams by the Chief Guest, Union Minister of State (Independent Charge) for Science and Technology; Earth Sciences and Minister of State for PMO, Department of Atomic Energy, Department of Space, Personnel, Public Grievances and Pensions, Dr Jitendra Singh in the presence of Secretary DST Prof. Abhay Karandikar.
The five testbeds are not just academic experiments — they are collaborative industrial pilot projects bringing together India’s top research institutions and leading cement manufacturers under a unique Public-Private Partnership (PPP) model. Each testbed addresses a different facet of CCU, from cutting-edge catalysis to vacuum-based gas separation.
The outcomes of this innovative initiative will not only showcase the pathways of decarbonisation towards Net zero goals through CCU route in cement sector, but should also be a critical confidence building measure for potential stakeholders to uptake the deployed CCU technology for further scale up and commercialisation.
It is envisioned that through continuous research and innovation under these test beds in developing innovative catalysts, materials, electrolyser technology, reactors, and electronics, the cost of Green Cement via the deployed CCU technology in Cement Sector may considerably be made more sustainable.
Secretary DBT Dr Rajesh Gokhale, Dr Ajai Choudhary, Co-Founder HCL, Dr. Rajesh Pathak, Secretary, TDB, Dr Anita Gupta Head CEST, DST and Dr Neelima Alam, Associate Head, DST were also present at the programme organized at Dr Ambedkar International Centre, New Delhi.

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Concrete

JK Lakshmi Adopts EVs to Cut Emissions in Logistics

Electric vehicles deployed between JK Puram and Kalol units

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JK Lakshmi Cement, a key player in the Indian cement industry, has announced the deployment of electric vehicles (EVs) in its logistics operations. This move, made in partnership with SwitchLabs Automobiles, will see EVs transporting goods between the JK Puram Plant in Sirohi, Rajasthan, and the Kalol Grinding Unit in Gujarat.
The announcement follows a successful pilot project that showcased measurable reductions in carbon emissions while maintaining efficiency. Building on this, the company is scaling up EV integration to enhance sustainability across its supply chain.
“Sustainability is integral to our vision at JK Lakshmi Cement. Our collaboration with SwitchLabs Automobiles reflects our continued focus on driving innovation in our logistics operations while taking responsibility for our environmental footprint. This initiative positions us as a leader in transforming the cement sector’s logistics landscape,” said Arun Shukla, President & Director, JK Lakshmi Cement.
This deployment marks a significant step in aligning with India’s push for greener transport infrastructure. By embracing clean mobility, JK Lakshmi Cement is setting an example for the industry, demonstrating that environmental responsibility can go hand in hand with operational efficiency.
The company continues to embed sustainability into its operations as part of a broader goal to reduce its carbon footprint. This initiative adds to its vision of building a more sustainable and eco-friendly future.
JK Lakshmi Cement, part of the 135-year-old JK Organisation, began operations in 1982 and has grown to become a recognised name in Indian cement. With a presence across Northern, Western, and Eastern India, the company has a cement capacity of 16.5 MTPA, with a target to reach 30 MT by 2030. Its product range includes ready-mix concrete, gypsum plaster, wall putty, and autoclaved aerated fly ash blocks.

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Concrete

Holcim UK drives sustainable construction

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Holcim UK has released a report titled ‘Making Sustainable Construction a Reality,’ outlining its five-fold commitment to a greener future. The company aims to focus on decarbonisation, circular economy principles, smarter building methods, community engagement, and integrating nature. Based on a survey of 2,000 people, only 41 per cent felt urban spaces in the UK are sustainably built. A significant majority (82 per cent) advocated for more green spaces, 69 per cent called for government leadership in sustainability, and 54 per cent saw businesses as key players. Additionally, 80 per cent of respondents stressed the need for greater transparency from companies regarding their environmental practices.

Image source:holcim

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