en.Wedoany.com Reported - India's cement industry may experience weak production growth in the first half of fiscal year 2026-27, with recovery expected only in the second half—according to the latest assessment by Nuvama Institutional Equities (Nuvama). The brokerage firm noted that a price hike initiated in April 2026 was insufficient to offset the overall decline in industry profitability.
Weak demand, coupled with planned capacity additions in FY2026-27 and FY2027-28, is expected to continue suppressing prices, which is the main reason for the bearish market outlook. The report analyzes that global uncertainties, labor shortages, heatwaves, raw material constraints, and unseasonal rainfall collectively dragged down demand in April and May 2026. Although producers attempted to raise prices across regions in April to absorb rising costs of petroleum coke and packaging, these increases quickly proved unsustainable. Nuvama data shows that standard petroleum coke prices have risen to $153 per ton, approximately $41 per ton higher than in the third quarter of FY2025-26.
Subsequent price corrections due to weak demand narrowed the net increase to about 10-12 rupees per bag by the end of the quarter. Imported petroleum coke prices have fallen from a recent high of $168 per ton to $132 per ton, but remain about $20 per ton higher than the previous quarter. The institution expects the impact of rising input costs to begin manifesting from the end of the first quarter of FY2026-27 and continue into the early second quarter.
Additionally, price increases linked to crude oil could raise packaging costs by approximately 120-150 rupees per ton while also pushing up freight costs. Nuvama warns that weak demand, combined with a significant influx of new supply in FY2026-27 and FY2027-28, will keep prices under sustained pressure, limiting room for margin recovery in the short term. The report ultimately concludes that production growth will be weak in the first half of FY2026-27, with a rebound expected in the second half.
