Cement prices likely to touch all-time high

Cement prices are likely to go up by another Rs 15-20 in the next few months and touch an all-time high of Rs 400 per bag on account of costlier raw materials such as coal and diesel, according to a report by rating agency Crisil.

The inflation will also lead to a decline of Ebitda (pre-tax profit) for cement makers by Rs 100-150 per tonne this fiscal because of high input costs, it said.

The cement industry had already gone for a price hike by an average Rs 10-15 per bag (consisting of 50 kg) across India in August.

"Retail prices of cement, after rising by an average Rs 10-15 per bag pan-India since August are likely to go up by another Rs 15-20 in the next few months and touch all-time highs of Rs 400 per bag," said the report.

However, it also added that cement sales volume is expected to rise 11-13 per cent this fiscal, compared with a low base of the pandemic impacted FY 2020-21.

"This will largely offset the impact of cost pressure on cash accruals and keep credit profiles stable," it added.

The recent rally in prices of imported coal, which is up by over 120 per cent in the first half; and petcoke, which is also up 80 per cent, is likely to increase power and fuel costs by Rs 350-400 per tonne this fiscal.