Cement Stocks Weaken Amid Crude Spike

The Indian cement industry is facing renewed margin pressure as rising fuel costs, linked to crude oil price escalation following West Asia tensions, weigh on profitability. While cement prices have remained resilient across regions, especially in the East and South, input cost inflation and competitive pressures have triggered a pullback in cement stocks. Seasonal demand trends and supply-side challenges add further uncertainty. Fuel Cost Impact - Crude oil prices surged 66% YTD 2026 to $101/barrel, raising energy costs. - Around 30–35% of cement production costs are linked to crude derivatives. - Refineries diverting feedstock towards LPG have created polypropylene (PP) shortages, impacting cement bag supply. - Rising input costs threaten margins despite stable pricing Pricing Trends - Cement prices have held firm, supported by increases in East and South India. - Nomura Research data shows national average prices resilient between Feb–Mar 2026. - Seasonal demand and regional strength have cushioned the impact of cost inflation. Company Performance - Major players affected:

, , , , . - Stocks pulled back amid broader market weakness and crude-linked cost pressures. - Seasonal demand uptick in Q3FY26 supported earnings, but Q4FY26 outlook muted. - Asian Paints-style commentary from cement majors highlights cautious tone on repainting frequency and demand visibility. Outlook - Near-term: margins likely under pressure due to fuel cost inflation and PP shortages. - Demand: muted in Q4FY26, with seasonal recovery expected in FY27. - Pricing discipline and regional resilience remain key positives. - Valuations have moderated, but investor sentiment remains cautious until input costs stabilize.