Indian Cement Industry Projected to Grow at CAGR of 10.64% through 2016, Reports BRICdata

24 Jul 2012 • by Natalie Aster

India is ranked as the second-largest producer of cement in the world, only behind China. The Indian cement industry increased in value at a compound annual growth rate (CAGR) of 13.14% during the review period (2007–2011), and is projected to grow at a CAGR of 10.64% over the forecast period (2012–2016). This growth is primarily attributed to the government’s high level of infrastructure spending, and the country’s increasing number of residential and commercial construction activities.

According to the report “Indian Cement Industry Outlook: Business Opportunities and Future Growth Potential to 2016” by BRICdata, the Indian government invested US$500 billion on infrastructure during the Eleventh Five-Year Plan (2007–2012) and revealed plans to invest a further US$1 trillion on infrastructure during the Twelfth Five-Year Plan (2012–2017). The large-scale investment on various infrastructure projects, including roads, railways, bridges and ports, will generate a huge demand for cement over the forecast period.

Shorter deadlines for builders to complete projects, labor shortages, space constraints in large cities, the growing need for mechanization and the backlog of infrastructure projects are the main factors driving the increased use of ready-mixed concrete (RMC) in India. Large township projects in the suburbs of India’s leading cities where IT zones are prominent are also generating more demand for RMC. Upcoming infrastructure projects, including energy, roads, ports and airport projects, across India will continue to drive the growth of RMC in India over the forecast period.

The Indian cement industry is expected to become more consolidated over the forecast period. Large companies are acquiring small firms, mostly regional firms, to increase their presence across the country and gain instant access to more production facilities. Meanwhile, smaller firms are exiting the industry due to either attractive acquisition deals from large companies or due to the difficulty in sustaining operations following rising input costs.

Report Details:

Indian Cement Industry Outlook: Business Opportunities and Future Growth Potential to 2016
Published: June, 2012
Pages: 54
Price: US$ 1.950,00

Key highlights of this title

• India is the second-largest producer of cement in the world 
• India has surplus production capacity. Despite this, more capacity addition is expected over the forecast period 
• The acceptance of ready-mixed cement is particularly strong in urban centers. The reliability of supply and consistent quality of ready-mixed concrete are the main reasons for the increasing popularity of the product, as these product qualities improve the productivity of builders. 
• The total investment in real estate is projected to reach US$1 trillion over the forecast period. The Indian government invested US$500 billion on infrastructure during the Eleventh Five-Year Plan (2007–2012) and revealed plans to invest a further US$1 trillion on infrastructure during the Twelfth Five-Year Plan (2012–2017). These investments will drive the growth of the cement industry in India over the forecast period.

More information can be found in the report “Indian Cement Industry Outlook: Business Opportunities and Future Growth Potential to 2016” by BRICdata.

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