Cement’s Long-Awaited Price Hikes Play Out: Motilal Oswal  

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Our channel checks suggest that the much-anticipated price hikes have materialized in March, with prices up by Rs 20-30/bag month-on-month in South and East and Rs 10-15/bag in other regions.

Demand remains strong, with growth in the high single digits in most regions (except South), which should help absorb these hikes.

These hikes should also alleviate concerns on near-term margins from the sharp cost inflation seen in the last few months – petcoke, coal, and diesel prices are up 74%, 24%, and 34% YoY, respectively.

We expect our coverage Ebitda to grow more than 25% YoY in Q4 FY21, driven by approximately 20% YoY growth in volumes (low base due to Covid-19 lockdown in March-2020).

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Motilal Oswal Cement Sector Update.pdf


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