Cement prices likely to increase amid rising costs of fuel, raw material: Report

Cement companies factor in 15-35 percent of total expenditure as fuels costs, which influence operating margins.

According to analysts, with improvement in demand from the real estate sector and with the government's push for infrastructure, the companies will pass on any increase in input prices to consumers in the near term.

In the October-December quarter, dealers may increase prices by 10-15 percent to offset rising input costs and protect margins, Times Now reported. Cement firms were looking at hiking prices in the July-September quarter too but refrained from it due to low demand, the report said.

In the second quarter, cement prices generally decline 2-3 percent quarter-on-quarter due to poor demand in the monsoon season.

“The cost of production has gone up significantly and every player has increased the prices,” N Srinivasan, vice-chairman and managing director, India Cements, told BusinessLine. His company saw its net profit declined to Rs 22 crore in the September quarter from Rs 71 crore in the year-ago period.