Tuesday, July 17, 2007

Exclusive: Cement industry in India going through a golden era

by Vipin Agnihotri

Even the hot Indian summer isn’t hampering construction activities in India and consequently the consumption of cement continues unbated. As demand for the commodity moves in tandem with the increasing capacities, cement giants in India are gobbling up smaller players to seize a larger proportion of the market. Hence, expansion is on, and so is consolidation. Growing annually at 10 percent, the cement industry in India is going through a golden era.

Continuing its full capacity utilization since January this year, the industry’s dispatches during March alone crossed the monthly production level of 14.95 million tonnes, so stand at 15.08 million tonnes, and were higher than last March’s dispatches of 14.24 million tonnes.

This situation is supposedly the real driving force behind the growing interest of foreign cement gains, which include Holcim, Lafarge, Italcementi and Hiedelberg, in the Indian cement industry. Last month itself, the Swiss cement maker Holcim, also the world’s second largest cement maker after the French group Lafarge, bought another 3 percent stake in ACC, taking its total holding to 41.6 percent. Holcim is now the largest shareholder in ACC.

This development comes at a time when the Indian cement industry has been already polarized between Holcim, commanding around 25 percent market share with a 34.2 million tonnes capacity through ACC and Ambuja, and the Aditya Birla Group. Birla controls 31.2 million tonnes of the total industry capacity through its group companies Grasim Industries and Ultratech Cements.

 

 

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