The Indian cement industry, which is currently very much in the process of consolidation, is geared for an 8% growth in sales during 2025 despite the challenges it faces in 2024. The anticipated growth is likely to come from increased government investment in infrastructure and housing projects and acquisitions among players such as UltraTech Cement and Adani Cements.
In 2024, the sector faced headwinds including slower volume growth, lower sales realization, and moderate capacity utilization. Factors such as a prolonged monsoon, election-related disruptions, and labor shortages contributed to a muted 4-5% volume growth. Additionally, falling cement prices—from ₹365 per 50kg bag in FY24 to ₹330 in the first half of FY25—impacted profitability across the industry.
However, several key players have made significant moves to bolster their positions in the market. The market leader, UltraTech Cement, which has a capacity of 156.66 MTPA, has announced an ambitious plan to reach the capacity of 200 MTPA by FY27. The company has also been expanding into geography through acquisitions, among them South-based India Cements Ltd, and is in talks to acquire Kesoram Industries' cement business.
Adani Cements is a new player in the game, and within two years, it crossed the 100 MTPA mark through acquisitions of firms such as Sanghi Industries, Penna Industries, and Orient Cement. The group plans to reach 140 MTPA by FY28, which will be very close to the growth trajectory of UltraTech.
Experts in the industry anticipate ongoing consolidation with projections showing the top five producers will account for almost 60-65% of total capacity. While 2024 is marked by structural changes and short-term challenges, the prospects remain bright in the long run. Demand from rural areas, housing in urban areas, and government infrastructure spending are expected to stimulate future recovery and growth.
This rebounding demand has propelled the sector to increase capacity by 70-75 mtpa by FY26. Transformative happenings are set for 2025 in the cement industry due to strategic expansions and government backing with accents on sustainability, innovation, and stout growth.
Conclusion
However, in spite of these unfavorable conditions, the Indian cement industry is poised for better recovery in 2025. Strategic acquisitions, aggressive expansion plans, and the government’s increased focus on infrastructure and housing developments prepare the industry for transformation from those years ahead. Established players like UltraTech Cement and Adani Cements are along with consolidation for competition development. Key challenges range from short-term price declines and; moderate capacity utilization, but long-term prospects remain solid. With consistent demand, better capacity, as well as strategic innovations, the industry should achieve the target of 8% and bring a stronger, more dynamic future.
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