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Cement price rise has impacted our profitability

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Ketan Patel, Director, Akshar Group, speaks about striking a balance between losses incurred and foreseeable profits, even as the real estate sector battles with rising prices of cement and other raw materials.

How is the current real estate market and how are your projects performing?
The market has opened up. We are expecting a good demand in real estate and are looking for it to lower down in the next two-three years. When we look at the statistics of the buyer, registrations, launches etc., of a quarter, if we try to neutralise the cement, then it comes across as more area- and demand-centric. In metro cities like Mumbai or Bangalore, real estate has to do well because of the demand
for it. More than demand, it is also about migration and work opportunities. As a result an entire ecosystem develops around it, which leads to demand and purchase.
I believe that we are building an asset, but then it comes down to what price point you have entered at, what specifications you are offering, if the zone has the typology requirement – all factors need to be kept in mind to understand the price and demand of that location. Sometimes, a single development from a particular brand and what they are offering changes the demand in a zone. Price, at the end of the day, is a prime factor and this market is centred around it.

Has the cost rise in cement and concrete building materials impacted your profitability?
Yes. Cement price rise has impacted our profitability, making it lower and, in some cases, it has led us to incur some losses, too. For the ongoing projects, where about 60 per cent to 80 per cent of the units are sold, we cannot now go to the buyer and tell them that the cost of raw materials has gone up and the remaining units, of which the construction was pending will be at a higher price. So, that is where we are incurring a low profit or loss per say.
I believe the cost of raw material has impacted on-going projects but for the new projects we are prepared that now the prices have gone up so we must have a 20 to 25 per cent buffer for that.

Are you expecting a change in consumer behaviour as the price of real estate will go up owing to the rise in the cost of raw materials?
Whenever we increase the price of our projects, we see a setback of 10 to 15 per cent in the overall sales funnel. But when we do look at it, the actual sales in the total sales funnel is approximately 10 per cent of the total enquiries. What we have observed over the years is that the number of enquiries go down when there is an increase in price. However, the customer who is looking to buy a house or property or upgrade does come through and convert as a customer.
We saw a trend through the pandemic that people have realised that housing is a very important aspect in their lives, as it was their homes that kept them safe in the difficult times. Demand in established locations has gone up as people want to upgrade.

As the raw material cost for construction is expected to stay volatile in the near future, what is the change in strategy adapted by you to navigate through it or will there be delays in delivery of projects?
We are looking at changing our strategies but we cannot delay any of our projects as that is more expensive than incurring higher prices of raw material for building materials. Waiting for the cost of raw materials to go down will throw us off our schedule and that will be a bigger chaos as the entire line of work will be disturbed. I might end up spending more than I would be saving with the wait duration.
However, with new launches, we can keep control and plan better. But once the project is on the floor, we have to go with the flow and match our deadlines, irrespective of the change in prices of the construction materials.

Tell us about the challenges you have faced with the rise in cost of cement.
We were not expecting the price of raw material to rise so much. We do account for 4 to 5 per cent of inflated prices but when it goes up to 15 to 20 per cent we have had to relook at our strategies. We cannot compromise on the deliveries to our customers, but at the same time we also have to understand how to absorb the cost.
Considerations had to be made if the project price should increase. But that too comes with its own set of challenges with the market price, competitor pricing of projects etc. Those were also the deciding factors on incurring some losses and not being able to transfer the cost to the consumer. However, that will also be averaged out in our future projects.

How is the future of real estate looking with the rise in cost of cement and building materials?
With the rise in cement cost and other building material costs, the same will eventually be carried forward to the buyer. This is a basic entrepreneurial rule. New launches will be expensive. In their initial stages, they may be at a 10 to 20 per cent lower cost, but I am foreseeing a rise in real estate price of about 18 to 20 per cent in the near future.
Materials like steel, cement and concrete are very important in any building. With the price of these materials rising, I have incurred losses in the previous projects, and we will be looking to recover the same in newer projects. This will become a market sentiment as similar challenges will be faced by the developer community.

-Kanika Mathur

Concrete

Cement Makers Reaffirm Commitment to Sustainable Growth

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World Environment Day spotlight on innovation and circularity

On World Environment Day, the Indian cement industry reiterated its commitment to supporting India’s climate ambitions through sustainable manufacturing, resource efficiency and the adoption of cleaner technologies.

The Cement Manufacturers’ Association (CMA) said the sector remains aligned with the Government of India’s Net Zero commitments and is accelerating efforts to reduce its environmental footprint while supporting the country’s infrastructure and development agenda.

Parth Jindal, President, CMA and Managing Director, JSW Cement, said the industry is increasingly adopting cleaner technologies, improving energy efficiency and expanding the use of alternative fuels and raw materials. He also highlighted the growing importance of circular economy practices, where industrial by-products and waste streams from one sector are utilised as resources in another.

“The Indian Cement Industry is aligned to the Government’s commitments on carbon mitigation and is accelerating the adoption of cleaner technologies, resource efficiency and circular economy practices while actively exploring the potential of Carbon Capture, Utilisation and Storage (CCUS) as a critical pathway for deep decarbonisation,” said Jindal.

He added that coprocessing industrial waste and by-products helps conserve natural resources, reduce disposal requirements and lower the environmental footprint across multiple sectors.

According to Jindal, sustainability is no longer limited to manufacturing processes but is increasingly influencing investment decisions, innovation strategies and long-term growth plans within the industry.

Echoing similar views, Dr Raghavpat Singhania, Vice President, CMA and Managing Director, JK Cement, said sustainable development extends beyond emissions reduction and must also focus on responsible resource utilisation and waste minimisation.

“Sustainability in the built environment cannot be measured by emissions alone. It is equally about how efficiently we use resources, how effectively we minimise waste and how responsibly we create the infrastructure that will serve future generations,” said Singhania.

He noted that the cement industry is advancing its sustainability agenda through greater resource efficiency, increased circularity, technological innovation and continuous improvements in manufacturing practices. As a key contributor to India’s infrastructure development, the sector has a critical role to play in balancing economic growth with environmental responsibility.

On the occasion of World Environment Day, industry leaders reaffirmed their commitment to supporting India’s climate goals while delivering the materials required for resilient, durable and sustainable infrastructure.

 

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Concrete

Building a Greener Future Together

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Environmental sustainability requires immediate action, not just long-term commitments and discussions. Recycling, circular economy practices, and technology-driven waste management can help industries reduce environmental impact while supporting sustainable growth.

Author: Jignesh Kundaria, Director and CEO, Fornnax Technology

World Environment Day serves as an important reminder that environmental sustainability can no longer remain confined to discussions, reports, or long-term commitments. The environmental challenges facing the world today demand immediate, measurable, and collective action. Across industries and communities, waste generation continues to outpace our ability to process it responsibly, placing increasing pressure on ecosystems, natural resources, public health, and the well-being of future generations.

One of the most significant shifts required today is a change in how society perceives waste. Rather than being viewed as a material to be discarded, waste must be recognised as a valuable resource that can contribute to both economic growth and environmental protection when managed through the right technologies and systems. This mindset forms the foundation of the circular economy model that countries across the world are increasingly adopting to reduce landfill dependence, recover valuable materials, and create more sustainable industrial ecosystems.

India has made meaningful progress in strengthening awareness around sustainability, recycling, and environmental responsibility over the past decade. Significant efforts are being made to formalise the recycling sector through improved infrastructure, technology adoption, policy implementation, and broader stakeholder participation. These developments are creating a stronger foundation for responsible waste management and resource recovery across the country.

However, achieving long-term environmental impact requires collaboration from all stakeholders. Industries, policymakers, technology providers, and communities must work together with greater accountability to strengthen recycling ecosystems, encourage responsible waste management practices, and create sustainable outcomes through consistent execution rather than temporary interventions.

As someone closely associated with the recycling industry, I firmly believe that technology will play a decisive role in addressing future environmental challenges. Advanced recycling systems have the potential to recover valuable resources, reduce pollution, minimise landfill burdens, and conserve energy, creating a more sustainable future for generations to come. This belief is deeply reflected in Fornnax’s motto, “Committed to Create a Green Future,” which embodies our commitment to building long-term environmental value through innovation and responsible action.

At the same time, technology alone cannot deliver meaningful change. Real progress requires intent, awareness, participation, and a shared sense of responsibility. Sustainable development can only be achieved when innovation is supported by collective action and a genuine commitment to environmental stewardship.

On this World Environment Day, let us move beyond conversations and take meaningful steps towards creating a cleaner, greener, and more sustainable planet. By embracing innovation, strengthening recycling ecosystems, and acting responsibly today, we can create lasting environmental impact and secure a better future for generations to come.

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Concrete

JK Lakshmi Advances LC3 Cement Expansion

Company highlights commercial production and research partnerships

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The meeting reviewed progress in limestone calcined clay cement (LC3) technology and its commercial adoption in India’s cement sector, focusing on low-carbon alternatives to conventional binders. JK Lakshmi Cement noted that limestone calcined clay cement can reduce carbon dioxide emissions by up to 40 per cent compared with conventional cement and said this reduction supports industry decarbonisation. The company highlighted that it was among the first two cement manufacturers in India to move LC3 into commercial production after the Bureau of Indian Standards approved the technology as a cement standard.

Vinita Singhania said the transition of LC3 from research to commercial production reflected collaboration between industry, academia and international institutions. Maya Tissafi acknowledged JK Lakshmi Cement’s role in advancing LC3 adoption in India and its contribution in taking the technology from laboratory trials to commercial implementation. Both representatives underlined the growing relevance of sustainable construction materials as India expands infrastructure and urban development.

The meeting explored continued collaboration with Swiss research institutions such as EPFL, EMPA and ETH Zurich alongside Indian academic partners and development organisations. JK Lakshmi Cement has been associated with the LC3 initiative since 2014 and worked with EPFL, IIT Delhi, IIT Madras, Development Alternatives and Technology and Action for Rural Advancement. The company conducted one of the earliest industrial trials of LC3 and recently announced commercial production of Green Pro LC3 cement from its Jaykaypuram plant in Rajasthan.

India remains the world’s second-largest cement producer and expansion of infrastructure, urbanisation and housing demand continue to support long-term sector growth, increasing interest in low-carbon technologies. The company reported an annual turnover of more than Rupees (Rs) 60 bn and current cement capacity of about 18 million (mn) tonnes (t) per annum, with a target of reaching 30 million (mn) tonnes (t) by 2030. Apart from grey cement, the company also makes ready-mix concrete, gypsum plaster, wall putty, primers, adhesives and fly ash blocks, and both sides concluded on the need for continued collaboration to develop sustainable construction solutions.

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