Ambuja Cements expects demand in the cement industry to grow over 7 percent in 2022, adding that it is ”well braced” to meet the requirements. The growth would be helped by factors such as infrastructure growth, demand for housing, increase in rural incomes and industrial growth, said Ambuja Cements, part of Swiss building material major Holcim group (earlier LafargeHolcim).

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The Union Budget 2022 had allocated Rs 48,000 crore towards the PMAY scheme (Pradhan Mantri Awas Yojana) and the completion of 8 million houses is envisaged in FY 2022-23, according to the company’s latest Annual Report. ”Activity in residential housing projects across towns and cities has also witnessed a sharp rebound and is approaching pre-COVID levels,” the report added.

On the industry outlook, Ambuja Cements Ltd (ACL) said, ”Cement demand is expected to grow at more than 7 percent YoY in the calendar year 2022.” This would be led by key drivers such as structural demand for housing due to the continued shortage of housing stock and increase in rural incomes over recent years, which will further supplement cement demand for individual housing. Besides, ”Healthy infrastructure growth over the next five years led by the government push to expedite the National Infrastructure Pipeline (NIP)” would also lead to growth, it added.

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The NIP projects are worth Rs 111 lakh crore and 80 percent of this is to be invested in road, energy, urban rail and irrigation sectors. ”The Union Budget 2022 has set a target to construct 25,000 km of national highways and has increased allocation for PMGSY (Pradhan Mantri Gram Sadak Yojana) by 36 percent,” the annual report said.

Moreover, growth in the industrial/commercial segment is driven by the requirement of warehousing space due to the e-commerce boom and data centres for back offices, which would also contribute to the demand. ACL Chairman N S Sekhsaria said, ”The industry offers significant headroom for growth aided by low per capita consumption and a massive government push for infrastructure and affordable housing” and the company is ”well-braced to meet the expanding demand.” ”We look at the future with unflagging enthusiasm. India continues to remain the second-largest cement producer in the world,” he said.

The Union Budget 2022-23 saw a significant increase in proposed capital expenditure, vindicating the government’s sustained focus on infrastructure. "Furthermore, the e-commerce boom, which is spurring demand for warehouse space, data centres and energy storage systems, will attract more investment as they have been granted infrastructure status,” he said.

As part of its growth strategy, ACL is investing in the cement grinding expansion plan of 7 MTPA (million tonnes per annum) across locations, including in a greenfield project at Barh, Bihar. ”This will help us move closer to our target of achieving 50 MTPA capacity in the near future,” he said.

Ambuja Cement has a present capacity of 31.45 MTPA. ”Further, we are increasing our presence in existing and new markets through our strong distribution network and dealer partnerships,” he said.

According to data available on Cement Manufacturers Association (CMA)’s portal, the total installed capacity in the Indian cement sector is approximately 545 MTPA.

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(Edited by : Anand Singha)