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India's cement demand is projected to grow by 7-8% in FY26, driven by real estate activity and government housing and infrastructure initiatives. According to an Axis Securities report, this follows a recovery in demand during the latter half of FY25. Despite a subdued start to FY25, strong momentum is expected to continue into Q1 FY26. Cement output in April-May 2025 increased by 8%. While pricing may remain competitive, sustained volume growth is anticipated, backed by increased government capital expenditure and a revival in construction.
A report by Axis Securities indicates that cement demand is expected to see significant growth in the upcoming fiscal year. This projection impacts India, as demand is driven by real estate activity and government support for housing and infrastructure projects, sustaining momentum from recent periods of recovery. Advertisement
The report states that cement demand is expected to grow in the range of 7% to 8% in fiscal year 2026. This projection is supported by the government's emphasis on infrastructure development and sustained real estate activity. Additionally, the budget allocation for infrastructure and construction in 2025-26 is likely to further strengthen cement demand in FY26.
The cement sector experienced a subdued performance in the first half of fiscal year 2025, with year-on-year growth of only 2-3%. However, cement demand showed a recovery in the third and fourth quarters of FY25, expanding at a high single-digit pace. For the full year FY25, the industry recorded an overall growth in the range of 4-5%.
Core sector data released by the central government confirms an 8% year-on-year growth in cement output during April-May 2025, driven by robust activity in infrastructure and construction. Historically, the fourth and first quarters of the fiscal year have been peak periods for cement consumption due to favorable weather, accelerated infrastructure spending, and a seasonal increase in real estate activity. The demand remains strong, and this positive trend is expected to continue into Q1 FY26.
While pricing may remain competitive due to increased competition and new supply entering the market, cement manufacturers are likely to benefit from sustained volume growth. The ongoing large-scale construction initiatives under various government schemes, including the Pradhan Mantri Awas Yojana (PMAY), are expected to drive consistent demand for building materials, particularly cement, which remains essential for housing infrastructure.
Source- ANI
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