Shares in Shree Cement took a hit after the company posted a 37 percent drop in first-quarter net profit.

HM Bangur, managing director of Shree Cement spoke to CNBC-TV18 about the cement demand and the realisations.

"Normally, demand is expected to rise by 7-8 percent, this year it will be in double-digits. The company is likely to beat the industry demand growth of around 10 percent," said Bangur.

"The company has entered some new markets and in that process the realisations were a bit down, plus freight costs increased but it will be recovered going forward," he added.

The realisations for the quarter stood at Rs 3900 and the company expect better realisations going forward.

"The margins are also expected to improve, and will not remain at current levels because prices hikes will be undertaken," Bangur said.

Bangur also clarified that the company is not only dependent on pet coke now and has the flexibility of using coal instead of pet coke.

"The difference between pet coke and coal prices is not much, sometimes coal is cheaper as well," he said. Currently, the fuel mix is of 60 percent pet coke and 40 percent coal.

When asked if the freight costs and employee costs are expected to remain at elevated levels, he said," They will remain same but will come down as percentage of revenues post the start of Karnataka plant and when volumes go up."