“Compared to urban areas, projects from the rural side are better. There is no labour issue in rural areas. Migrant labourers are seeking job opportunities in their own hometowns instead of coming back,” said Shree Cement’s managing director, Hari Mohan Bangur, in an interaction with ET.
“Almost all the dealers foresee 10-30% drop in demand in fiscal 2021 due to delay/freeze in construction activity,” the report said. As markets reopen in the second half of May, cement prices are expected to jump Rs 15-20/ bag initially due to supply constraints However, over the medium term, we expect price hike to be rolled back due to lack of demand pick-up and rising competition.
The survey was conducted among more than 100 dealers spread across Tier 1 and 2 centres in thirteen states to glean insights into the impact of thr pandemic. Incidentally, trade channels account for nearly 60% of annual cement sales.
While the Karnataka government has ordered price caps on cement prices by responding to the construction industry pleas, others like Telangana and Andhra Pradesh are engaged in parleys with cement and steel producers to rationalise prices.
On February 6, the Emami group said that to enter into an agreement with Nuvoco Vistas Corporation, part of Nirma Group, to sell 100 per cent equity in Emami Cement Ltd at an enterprise valuation of Rs 5,500 crore. Issuing a joint statement, both Emami and Nuvoco Vistas said the deal is subject to clearances from competition regulator CCI and other approvals.
Cement manufacturer India Cements said it has adopted a series of precautionary and safety measures at its facilities including compliance with standard operating procedures and other measures as advised by government authorities.
The company, which restarted its factory in Guwahati with about 30% of workers using as much as 20% of capacity, expects a revival in demand only after September, Chief Executive Officer Sanjay Gupta said in a phone interview.
India Cements Vice Chairman N Srinivasan was among those who attended the meeting and said that with no income and financial strain, the industry will face enormous difficulty if the lockdown is continued. He added that there will be a problem with raising funds from banks and paying salaries in the future too.
Operations have partially resumed or are being resumed after initiating all necessary safety measures for workmen and employees, as stipulated by government authorities, JK Cement said in a regulatory filing.
The genesis of the dispute lies in several tax notices issued by the GST department of Rajasthan for the dues of around Rs 72 crore between February to June 2019 for the unpaid dues of Binani Cement. The lawyers for the GST department had argued in the court that it was not heard by the committee of creditors (CoC) before finalising the resolution plan and as such, it is not bound by it.
Keeping a pessimistic approach, the rating agency said the cement demand in India would contract by an unprecedented 20-25 per cent this fiscal if the country is unable to contain the pandemic by May.
The lockdown to prevent spread of coronavirus has brought almost all economic activities to a halt, with daily wagers, especially migrating workers, employed in construction and other informal sectors forced to return to their respective villages, mostly on foot.
Emami Cement operates one integrated cement plant and three grinding units with a total cement grinding capacity of around 8.3 million tonnes per annum. Manish Goenka, director, Emami Group said this transaction is an important step in the group’s stated objective of becoming debt-free and it will substantially achieve this objective now.
Finance minister Nirmala Sitharaman announced the plans to set up five new smart cities on PPP model and 100 more airports to be set up by 2024 to support UDAN scheme and allocated Rs 1.7 lakh crore to transportation. Cement manufacturers association said the emphasis on infrastructure development will go a long way to revive cement demand.
The company announced that this is the first time that a cement manufacturer has obtained license for manufacturing oil well cement in the North East region from API (American Petroleum Institute) & BIS authorities.
The group that now has a capacity of 11 million tonnes is trying to consolidate its position in the industry that is 40% dominated by the biggest two players — Ultra-Tech Cement and Ambuja.
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