Cement Industry Consolidation To Continue, Dalmia Bharat Expects 7-8% Growth In FY26

Dalmia Bharat has projected a strong rebound in cement demand, expecting industry growth to reach 7-8% in FY26. The company anticipates continued consolidation among major players, with the top four cement manufacturers likely to control over 60% of total industry capacity within the next two years.  

Market Growth And Expansion Plans 

- Cement demand growth slowed to around 5% in FY25 due to general elections and erratic monsoons, but is expected to recover in FY26  
- Key drivers of growth include housing, infrastructure development, and private investments  
- The industry’s installed capacity is projected to reach approximately 670 million tonnes by the end of FY25, supported by the commissioning of 33-35 million tonnes of new capacity  

Sector Consolidation And Capacity Expansion

- The pace of consolidation has increased over the last three years, with the top four companies expanding their capacity share from 48% in FY22 to nearly 58% in FY25  
- In FY25 alone, 52 million tonnes of cement capacity changed hands through mergers and acquisitions  
- Dalmia Bharat aims to increase its cement capacity from 49.5 million tonnes per annum (MTPA) to 75 MTPA by FY28, with a long-term target of 110-130 MTPA  

Investment And Pricing Strategy

- The company has announced plans to invest ₹3,520 crore over the next two years, adding 3 MTPA cement capacity each in Pune and Belgaum  
- Cement prices declined by 7% year-on-year in FY25, but the trend is now reversing, with prices rising by 3% in March 2025  
- Dalmia Bharat is focusing on cost savings through renewable energy and digital supply chain optimizations, aiming to reduce costs by ₹150-200 per tonne  

Industry Perspective  

The cement industry’s consolidation and expansion efforts signal a shift toward greater efficiency and market dominance by leading players. With infrastructure projects and housing demand driving growth, FY26 is expected to be a strong year for the sector.  

Sources: Economic Times, Moneycontrol, MSN.