Economy & Market

Sluggish market

Published

3 years ago

October 14, 2021

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Cement demand remained subdued during Q1FY14 after witnessing weak growth of nearly 5.5per cent during FY13. This was impacted by lack of construction activity due to Infra and housing slowdown, labour shortage coupled with early onset of monsoons. However, cement prices continued to remain firm after witnessing declines during beginning of Q1FY14.

Cement demand growth

continued to remain sluggish in Q1FY14, impacted by continued weakness in Housing and Infrastructure verticals. Capacity utilization is likely to remain soft. Dealers across regions highlight limited near-term visibility of demand recovery. However, they are hopeful that the election impact would play out in favor for demand uptick in H2FY14, resulting in 6-7per cent volume growth. The demand remains sluggish in most regions and may worsen in the next one month due to monsoon and prices are likely to fall further. Overall, while visibility remains weak for the near term, medium-term demand outlook remains optimistic with several infrastructure/power projects underway.

Weak pricing scenario – lowest since Q3FY11

Cement prices witnessed a bounce-back in the month of May 2013 after two consecutive months of decline. On a pan India basis, they increased by Rs.15 per bag in this month.

However, this was a repercussion of the increase in coal prices and an earlier hike in railway freight charges. Cement producers passed on these cost hikes to their consumer and tried to regain some pricing discipline.

Though prices staged a recovery late in the quarter (post May 15), poor availability of construction materials (sand and bricks), and the early arrival of the monsoon restricted further price hikes. Cement prices in Andhra Pradesh remained low due to political issues impacting construction activities. However, on account of high base prices of last year, cement prices are down 2.3per cent y-o-y, with South (down 4.5per cent y-o-y) being the worst affected region followed by East (down 3.6per cent y-o-y). Cement prices in northern region witnessed correction during beginning of Q1FY14 led by lack of demand and labor unavailability. However, prices have started recovering later and currently range around Rs.270-275 on an average in northern region. Prices have remained largely stable in eastern India but may witness correction as monsoon progresses and demand remains weak.

EBIDTA/tonne could decline due to cost pressures

Aggregate operating cost per MT is expected to grow by 3.5per cent y-o-y and 2.5per cent q-o-q, led by higher energy and freight cost. During the quarter, diesel price increased by 4.7per cent q-o-q, leading to higher freight cost. Power and fuel cost is expected to remain stable at the higher levels despite a 5per cent q-o-q fall in international coal prices, as the decline is partially offset by the rupee depreciation of 3.3per cent q-o-q.

Slowing capacity addition on account of huge surplus

Fresh capacity addition by the cement industry is expected to slow down as demand fails to keep pace with new additions. The industry’s production capacity increased to 325 million tonnes (mt) last fiscal as compared to 219 mt in FY09, registering a compounded annual growth rate of 10.4 per cent. Given the huge surplus situation prevailing in the industry, the pace of capacity addition could decelerate going ahead. The industry may add about 66 mt in the next three fiscals. Going forward, the capacity utilisation rate may improve gradually given the slowdown in pace of capacity addition and recovery in demand.

Outlook

For FY14 as a whole cement demand growth is expected to remain muted at ~6per cent. Profitability for national players could come under pressure if they are faced with increased supply from regional players. The current fiscal is expected to see capacity additions of 30 mn tonnes. FY14 is likely to surprise positively on demand front (though back ended) with a line-up of large state elections. Pricing is expected to remain stable to buoyant as well. Going forward, we expect cement demand to improve in H2FY14 on the back of benefits resulting from likely decline in interest rates, pre-assembly and general election infrastructure spending, pick-up in individual housing/affordable housing and improvement in the execution of stalled projects.

Companies having a strong presence in the southern part of the country may fare well as compared to those located in the northern part as the demand in the southern region looks stronger as compared to that of in northern India.

Post monsoons, prices are likely to firm up led by demand improvement on pre-election spend as well as improved pace of infrastructure awards. One could pick stocks in this sector in the monsoon related weakness as demand revival is expected in H2FY14.

Economy & Market

RAHSTA to showcase cutting-edge road construction tech, says NCC Director

Published

1 week ago

April 19, 2024

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14th RAHSTA (Roads and Highways Sustainable Technologies & Advancement) Expo – India’s biggest road exhibition – will be held as a part 10th India Construction Festival 2024 at Jio Convention Centre, Mumbai, from October 9-10, 2024.

April 10, 2024, Delhi

“The RAHSTA expo will offer extensive information about the latest technology and methods for constructing high-quality roads. Currently, the challenge facing the roads industry is to uphold road quality and execute projects efficiently. RAHSTA will provide opportunities for everyone to learn about the latest worldwide technologies and equipment available, undoubtedly offering valuable insights to those involved in the roads sector,” said Vinod Kumar Yadav, Director – Transport, NCC, and former Chairman, Railway Board, while speaking during the launch of a road show – 14th RAHSTA Expo, which will be held from October 9-10, 2024, at Jio Convention Centre, Mumbai.

RAHSTA, which stands for Roads and Highways Sustainable Technologies & Advancement, is a dedicated event to the world of road construction equipment, technology, and sustainability.

“The Ministry of Road Transport & Highways has constructed 12,349 km of national highways in 2023-24 – the second highest achievement! In 2020-21 a record 13,327 kms had been constructed, the highest so far. The experience of a well-constructed road is no accident but a badly constructed one can cause many,” stated Pratap Padode, Founder, FIRST Construction Council, a pioneering infrastructure-driven council focused on advancing India’s infrastructure development.

Also speaking at the launch, former Managing Director of Ashok Leyland & JCB, Vipin Sondhi, also Chairman of RAHSTA Expo Committee underscored the need for specialised platforms like RAHSTA Expo for the burgeoning road construction industry.

Ashish Kumar Singh, CGM – Finance, National Highway Authority of India; RK Pandey, former NHAI member and Member of RAHSTA Expo Committee; SK Nirmal, Secretary General, Indian Roads Congress and Member of RAHSTA Expo Committee; Prof Satish Pandey, Principal Scientist, CSIR-Central Road Research Institute, Ministry of Science and Technology; Ankit Jain, CFO, Cube Highways Growth Advisors, Vijay Agrawal, Executive Director, Equirus Capital; and Subodh Dixit, Former Executive Director, Shapoorji Pallonji, participated in a round table discussion on the new BOT proposals.

The launch function at PHD Chamber for RAHSTA Expo was attended by who’s who of the infrastructure industry such Lt Gen Harpal Singh, President, International Road Federation and former Engineer-in-Chief, Indian Army; Akhilesh Srivastava, Road Safety Ambassador, International Road Federation; Sandeep Singh, Managing Director, Tata Hitachi Construction Machinery; Rajesh Menon, Director General, Society of Indian Automobile Manufacturers; Raman Kapil, President, Tata Projects; Anand Sundaresan, Director, Ammann India; Dheeraj Panda, Managing Director, Ammann India; Rajan Aiyer, Managing Director, Trimble; Satin Sachdeva, Founder & Secretary General, Construction Equipment Rental Association; Dr Swamy, Chairman, The Institution of Civil Engineers and Dr Ranjeet Mehta, Executive Director of PHDCCI, among others.

Organised by the FIRST Construction Council, the RAHSTA Expo 2024, which will be held as part of 10th India Construction Festival, will bring together industry leaders, innovators, and stakeholders for two days of exploration, collaboration, and transformation.

Besides RAHSTA Expo 2024, the India Construction Festival 2024 will include the following:

Exhibitors can use RAHSTA Expo 2024 to showcase their construction machinery, building material machines, mining machines, and construction vehicles to a targeted audience of industry professionals. RAHSTA Expo will be an ideal platform to connect with key decision-makers, generate leads, and grow business in this rapidly expanding market.

Contact:

For exhibitor enquiries (for RAHSTA Expo), contact Mr Sujoy on Mob: +91 86577 95881, or Email: sujoy.g@asappinfoglobal.com

For delegate enquiries (for conferences), contact Mr Amar on Mob: +91 86524 93000, or Email: delegate1@asappinfoglobal.com

Economy & Market

RAHSTA will drive road construction innovation: Sundaresan

Published

1 week ago

April 18, 2024

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April 10, 2024, Delhi

“We believe RAHSTA is the ideal platform for our presence, and we are confident in our participation in the upcoming expo scheduled for October,” said Anand Sundaresan, Director, Ammann India, while speaking during the launch of a road show – 14th RAHSTA Expo, which will be held from October 9-10, 2024, at Jio Convention Centre, Mumbai. RAHSTA, which stands for Roads and Highways Sustainable Technologies & Advancement, is a dedicated event to the world of road construction equipment, technology, and sustainability.

Sundaresan added, “We predominantly specialise in road construction machinery, such as asphalt plants, concrete batching plants, pavers, and rollers, among others. Additionally, we offer ancillary equipment like supers. With the government placing significant emphasis on infrastructure development, there is a substantial demand for road construction machinery. Particularly noteworthy is the growth witnessed in the last year (2023-2024), with a surge in orders. Moreover, the construction of airports is underway, necessitating equipment for runway construction. We perceive immense potential and opportunity for growth within the industry.”

“The Ministry of Road Transport & Highways has constructed 12,349 km of national highways in 2023-24 – the second highest achievement! In 2020-21 a record 13,327 kms had been constructed, the highest so far. The experience of a well-constructed road is no accident but a badly constructed one can cause many,” stated Pratap Padode, Founder, FIRST Construction Council, a pioneering infrastructure-driven council focused on advancing India’s infrastructure development.

Padode was speaking at the launch of a road show – 14th RAHSTA Expo, which will be held from October 9-10, 2024, at Jio Convention Centre, Mumbai. RAHSTA, which stands for Roads and Highways Sustainable Technologies & Advancement, is a dedicated event to the world of road construction equipment, technology, and sustainability.

Speaking at the launch, former Managing Director of Ashok Leyland & JCB, Vipin Sondhi, also Chairman of RAHSTA Expo Committee underscored the need for specialised platforms like RAHSTA Expo for the burgeoning road construction industry.

Ashish Kumar Singh, CGM – Finance, National Highway Authority of India; RK Pandey, former NHAI member and Member of RAHSTA Expo Committee; SK Nirmal, Secretary General, Indian Roads Congress and Member of RAHSTA Expo Committee; Prof Satish Pandey, Principal Scientist, CSIR-Central Road Research Institute, Ministry of Science and Technology; Ankit Jain, CFO, Cube Highways Growth Advisors, Vijay Agrawal, Executive Director, Equirus Capital; and Subodh Dixit, Former Executive Director, Shapoorji Pallonji, participated in a round table discussion on the new BOT proposals.

The launch function at PHD Chamber for RAHSTA Expo was attended by who’s who of the infrastructure industry such Lt Gen Harpal Singh, President, International Road Federation and former Engineer-in-Chief, Indian Army; Akhilesh Srivastava, Road Safety Ambassador, International Road Federation; Sandeep Singh, Managing Director, Tata Hitachi Construction Machinery; Rajesh Menon, Director General, Society of Indian Automobile Manufacturers; Raman Kapil, President, Tata Projects; Anand Sundaresan, Director, Ammann India; Dheeraj Panda, Managing Director, Ammann India; Rajan Aiyer, Managing Director, Trimble; Satin Sachdeva, Founder & Secretary General, Construction Equipment Rental Association; Dr Swamy, Chairman, The Institution of Civil Engineers and Dr Ranjeet Mehta, Executive Director of PHDCCI, among others.

Besides RAHSTA Expo 2024, the India Construction Festival 2024 will include the following:

Contact:

For exhibitor enquiries (for RAHSTA Expo), contact Mr Sujoy on Mob: +91 86577 95881, or Email: sujoy.g@asappinfoglobal.com

For delegate enquiries (for conferences), contact Mr Amar on Mob: +91 86524 93000, or Email: delegate1@asappinfoglobal.com

Concrete

New appointment at TMEIC

Published

1 week ago

April 17, 2024

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TMEIC Industrial Systems India, a Group company of TMEIC Corporation, Japan, has announced the appointment of Hidekazu Matsushima as the new Managing Director. Matsushima has been associated with Mitsubishi Electric FA division for domestic market in Japan since 1991 and been assigned in Industrial division in 1994, where he rolled out his mission of sales, marketing and business development of General industry (GI) such as paper, film, Oil & Gas, petrochemical, cement, food, automobile, semiconductor industries in Japan. During the establishment of TMEIC in Japan in 2003, he was assigned with the responsibility for domestic GI market Sales in Japan HQ, and then in plant and energy sales department.