Construction Industry News
Cement sector has been reeling under the pressure rising raw material costs and lower realizations. The growth in demand on year-on-on year basis has also not been encouraging. Overall production and dispatches during January 2011 had risen marginally – by 1.7 per cent and 0.3 per cent, respectively as compared to the previous corresponding period (As per Anand-rathi reports).
The Union Budget proposals announced today have not provided much relief for the sector.The Union Budget also proposed replacement of excise duty with ad-valorem duty for cement. Analysts reckon that for cement bags priced up to Rs 190 a bag, manufacturers will have to pay revised duty of 10 per cent of the price, plus additional duty of Rs 80 a tonne. On the other hand, for bags priced more than Rs 190 a tonne the additional duty would be at Rs 160 a tonne apart from duty of 10 per cent of the price. Most analysts maintain that this would lead to additional burden on cement players.
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