India’s cement sector has improved its energy and carbon efficiency, but rising groundwater use in water-stressed regions and deteriorating worker safety remain significant concerns, according to a report by the International Forum for Environment, Sustainability & Technology (iFOREST). The findings also highlighted weak policy implementation and gaps in sustainability reporting.

India, the world’s second-largest cement producer, uses about 2.54 gigajoules of energy per tonne (GJ/t), below the global average of 2.88 GJ/t. However, renewable sources accounted for only 5.1 per cent of the sector’s energy mix, indicating continued dependence on conventional sources.

The report assessed 18 cement companies against 107 Business Responsibility and Sustainability Reporting indicators for FY24 and FY25. The companies covered 87 per cent of India’s cement production. Carbon emissions intensity declined from 0.58 to 0.57 tonnes of carbon dioxide per tonne, but total emissions increased 4 per cent to 224.3 mn t, equivalent to about 6 to 7 per cent of India’s overall emissions.

Overall water withdrawal declined 9.5 per cent during the study period, while withdrawals in water-stressed areas, mainly in Rajasthan, increased by more than 20 per cent. Groundwater’s share of withdrawals in these areas rose from 27 per cent to 38 per cent, raising concerns about the sector’s impact on vulnerable water resources.

The sector employs about 228,000 people, including 63 per cent contractual workers, 3.1 per cent women and 0.07 per cent persons with disabilities. Women in key managerial roles earned 26.8 per cent less than men, while median pay for women workers fell 11.1 per cent in FY25 as men’s pay increased. Worker injuries rose 36.5 per cent to 359, and fatalities increased from 17 to 22, with workers accounting for more than 90 per cent of deaths.

iFOREST recommended cement-specific reporting guidance, standardised metrics, mandatory production disclosure and third-party verification. It also called for environmental, social and governance policies to be integrated into business strategies and implemented more effectively on the ground.

Ambuja Cements expects its sales volumes to grow faster than the cement industry during the second half of fiscal year 2027, as it seeks a recovery in institutional demand after a weak first half. The Gautam Adani-owned company is aiming to rebuild volumes while protecting profitability.

The company reported a 90 per cent year-on-year decline in consolidated net profit attributable to owners of the parent to Rs. 1.93 bn for the quarter ended 30 September, from Rs. 17.74 bn a year earlier. The previous year’s profit included a reversal of income-tax provisions worth Rs. 16.97 bn. Revenue from operations rose marginally to Rs. 91.66 bn from Rs. 91.3 bn.

Trade volumes increased 8.6 per cent year-on-year in the September quarter, but weaker institutional sales left overall volumes broadly unchanged. Ambuja Cements expects both trade and institutional sales to turn positive in the third and fourth quarters. Trade sales are made through dealers and distributors, while institutional or business-to-business sales involve bulk supplies to infrastructure developers, government projects and real estate companies.

The company had earlier reduced institutional sales that did not generate adequate returns. It now plans to rebuild the business selectively, while continuing to prioritise trade sales and higher-value products. Trade accounted for 74 per cent of sales in the quarter, up six percentage points from a year earlier, while premium products increased to 37 per cent of trade sales from 35 per cent. Blended cement’s share rose to 82 per cent from 77 per cent.

Ambuja Cements commissioned 4.6 mn t of capacity during the quarter. Another 3.2 mn t at Bathinda in Punjab and Jodhpur has stabilised, with the facilities expected to ramp up in the second half. A further 2.4 mn t facility at Varkala in Bihar is scheduled for commissioning during the period. Higher fuel and logistics costs remain a challenge, while the company has realised a cement price increase of about Rs. 10 per bag in October and is targeting operating costs of Rs. 4,250 per t for the full year.