Cement Industry: Weak Realizations Persist Amid Capacity Additions
Cement companies exited Q3FY26 with sequential price corrections across regions, raising concerns about profitability amid muted realizations. Average all-India cement prices fell 1.6% QoQ to ₹336 per 50-kg bag, according to Elara Securities. The steepest decline came from the southern region, where oversupply and weak demand continue to weigh on prices.
1. All-India Price Trends
- Average cement prices fell 1.6% QoQ to ₹336 per bag in Q3FY26.
- Weak realizations are expected to pressure margins across companies.
2. Southern Region Weakness
- Prices in the South dropped 3.9% sequentially to ₹304 per bag, the sharpest decline among regions.
- Tamil Nadu and Kerala saw ₹5 per bag declines, while Karnataka, Andhra Pradesh, and Telangana remained flat in December.
- After sharp hikes in April (₹20–45 per bag), prices have trended downward through 2025.
3. Structural Challenges in the South
- Oversupply and relatively lower demand growth are the primary drags.
- Intensified competition following acquisitions:
- Adani Group acquired !Penna Cement and