Dalmia Bharat plans to invest approximately Rs 10 billion in capital expenditure for the quarter ending in March, bringing its total expenditure for the current fiscal year to around Rs 30 billion.

As for the fiscal year 2025-26 (April-March), the company intends to spend between Rs 25 billion and Rs 30 billion on capital expenditure. Dalmia Bharat’s current annual production capacity is 46.6 million tonnes, which is set to increase to 49.5 million tonnes by the end of March.

India, being the second-largest cement producer globally, has seen domestic players aggressively expand capacities through both expansion and acquisitions to meet the anticipated demand driven by the government’s infrastructure push. It is projected that between 2024 and 2028, 150-160 million tonnes of capacity will be added, driven by a combination of organic and inorganic growth. This increase in supply, coupled with heightened competition, is expected to limit the growth of cement prices, as noted in a Crisil report from last year.

Dalmia also mentioned that while optimism surrounding cement prices has risen due to recent price recoveries, the intensifying competition may prevent any substantial price increases. He noted that the current market conditions are marked by aggressive market share pursuits, which, coupled with the lack of demand growth in the first nine months, have added strain to the industry. He pointed out that every industry goes through phases where the focus shifts from market share to prioritizing margins, as beyond a certain point, market share no longer delivers value.

He anticipates that competitive pressure, particularly in the southern markets of India, will persist, alongside ongoing consolidation within the industry.

News source: The Economic Times