The Indian cement industry is poised for growth, driven by infrastructure development, housing demand, and government initiatives. As the sector continues to consolidate, there are opportunities for companies to expand their capacity and improve their market share.
Global Cement Industry Trends
The global cement industry is undergoing significant changes, with a focus on reducing carbon emissions and promoting sustainable construction practices. Companies like Holcim, Heidelberg Materials, and CNBN are leading the way in this effort. Holcim, for example, is expanding its portfolio of high-value building solutions, such as building systems and high-performance concrete, to ensure that half of its net sales come from these areas.
Cement Industry Consolidation in India and China
In India, the cement industry is consolidating, with the top 10 cement companies accounting for over 60% of the country’s clinker capacity. This consolidation is driven by the need to reduce costs and improve efficiency in a highly competitive market. However, China, the world’s second-largest cement producer, still has a long way to go in terms of consolidation. China hosts the world’s two largest cement companies, CNBN and Anhui Conch, but still has a large number of independent small cement companies operating in the country.
- China’s cement industry is expected to continue to face challenges, including a decline in demand for cement due to infrastructure development and a slow-down in the housing market.
- The country’s cement industry is also expected to see significant consolidation, with smaller companies being forced to sell out to larger companies due to pressure on margins.
US and European Cement Markets
The US and European cement markets are expected to continue to grow, driven by infrastructure renewal and maintenance, as well as the need for new housing. The US saw a marginal fall in production to 86m tonnes in 2024, but is expected to see a rise in infrastructure investment, which will generate cement demand. Europe, which is increasingly focused on green cement, had a cement market for 315.8m tonnes in 2024, with Germany leading the pack.
| Country | Cement Production (2024) | Cement Consumption (2024) |
|---|---|---|
| India | 184.2m tonnes | 110m tonnes |
| China | 530m tonnes | 240m tonnes |
| US | 86m tonnes | 103m tonnes |
| Europe | 315.8m tonnes | 315.8m tonnes |
Indian Cement Industry Outlook
The Indian cement industry is expected to see a healthy growth of 6-7% in the current year, driven by improvement in demand from housing and infrastructure sectors. Infrastructure and rural housing, both prioritised by New Delhi for funding, will have more than 30% share each of the country’s cement use. Urban housing will also benefit from falling interest rates, which will drive demand for cement.
“I foresee a healthy Indian cement volume growth of 6 to 7% fueled by improvement in demand from housing and infrastructure sectors,” says Abhishek Lahoti, ICRA official.
Capacity Addition and Consolidation
The Indian cement industry is expected to see significant capacity addition, with estimates of 43-45m tonnes in the 2026 financial year. Large cement groups operating at optimal utilisation levels are principal movers in fresh capacity building, driven by the need to maintain their market share. The industry’s capacity utilisation in the current year will remain stable at 70% on an expanded base.
Vietnam’s cement market is expected to record a CAGR of 7.98% between 2025 and 2033, driven by growing demand for urban housing, commercial buildings, and infrastructure. Government support, including investment incentives and streamlined regulatory processes, will encourage investment in the sector. Vietnam is also a regular exporter of cement, with overseas shipments of 20.29m tonnes in 2024.
The Indian cement industry is poised for growth, driven by infrastructure development, housing demand, and government initiatives. As the sector continues to consolidate, there are opportunities for companies to expand their capacity and improve their market share. With a focus on reducing carbon emissions and promoting sustainable construction practices, the industry is expected to see significant growth in the coming years.
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