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June 21, 2001
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Money > Business Headlines > Report June 21, 2001 |
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Cement sector upbeat on housing boom, Gujarat reconstructionSurajeet Das Gupta Cement manufacturers expect a substantial upturn in demand in 2001-02, from the construction industry and reconstruction work in Gujarat. Manufacturers expect demand to go up by 6-7 per cent this year, compared to the negative growth of around 2 per cent in 2000-01. Gujarat Ambuja executive director LM Singhvi says, "We are expecting a good year prodded on by the large scale reconstruction activity in Gujarat. There is also renewed activity in the housing sector with real estate becoming cheaper." Singhvi points out that the offtake in Gujarat, which is usually around 550,000 tonnes a month, has gone up by 150,000 tonnes primarily because of the reconstruction activity in the Kutch area. Also, with the expected good monsoons, water shortage a major negative factor for the construction industry last year in states like Rajasthan, Gujarat and Madhya Pradesh will not be an issue. Cement demand is also expected to come from government orders through the ambitious National Highway project. "We expect as much as 1,000 kilometres of this road to be concretised. So there will be a demand for around 3 million tonnes from this project alone, which is about 2-3 per cent of the total production of cement," says AV Srinivasan, secretary general of the Cement Manufacturers Association. The association expects the industry to breach the 100 million-tonne mark this financial year, from the 94 million tonnes of cement produced last year. Srinivasan also points out that the good monsoons will have a positive impact in the rural sector. Cement production in the first quarter of April-June has seen 3-4 per cent growth, but demand in the monsoon months is usually depressed. He expects it go up substantially with the festive season. The companies are hoping to substantially bridge the gap between actual installed capacity and demand for cement in the country this year. SK Wali, joint president of Lakshmi Cement, a division of JK Corp says, "There is a 3 million-tonne gap between actual capacity and demand which could be reduced substantially with better demand from infrastructure projects." Powered by YOU MAY ALSO WANT TO READ:
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