SECTOR UPDATE: Cement

Mumbai : The prospects for the next few months are likely to remain subdued in light of the weak demand, analysts say. The cement sector continued its dismal performance in May 2011, going by the production and dispatches figures released by industry majors. ACC alone managed an increase in dispatches, up 13.7% year-on-year (y-o-y) to 1.99 million tonne (MT), on the back of a low base in the previous corresponding period and capacity expansion.

Ambuja Cement saw dispatches decline 6.6% to 1.8MT, while UltraTech’s dispatches of 3.2MT declined 3.3% on a y-o-y basis. JP Associates’ dispatches increased marginally from 1.3MT in May 2010 to 1.4MT in May 2011. Aggregate dispatches by these four players show a marginal 0.6% growth during May 2011 over May 2010. However, the aggregate dispatches declined 2.1% over April 2011.