Southern cement makers to lag peers in March quarter
Cement makers in the north and the south of the country are expected to post contrasting growth, again. Worst hit by demonetisation, northern companies have since recovered partially and their volumes are expected to jump 10-12 percent in the quarter ended March compared to the previous three months, according to Amey Joshi, associate director of India Ratings. That’s three times the estimated growth of their southern peers, which were least impacted by the note ban, Joshi told. Political instability in Tamil Nadu may hurt the performance of south-based companies, he said. Cement makers in the region may report a flattish volume growth in the absence of any price hikes even as their northern peers increased prices by 10-15 percent, he said. The southern cement market had managed to cushion the impact of demonetisation. Volumes of south-based companies grew 21 percent in the three months ended December, according to India Ratings. Northern, central and pan-India cement makers, however, saw their volumes decline during the period. North-based players were the worst hit as their volumes contracted 6 percent. They have since recovered. Cement companies in west India are also expected to grow as much as their northern rivals in the fourth quarter, followed by pan-India players.
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