Cement & Construction Industry Profile
Characteristics of Indian cement industry are
- Highly fragmented (low entry barriers)
- Cyclical industry
- Highly capital & energy intensive
- Heavily taxed sector
- High bulk (volume) low value product
- Heavy dependence on 3 sectors viz. coal, power and transport
Cement & Construction Industry ProfileMarket consolidation
Flurry of consolidation has happened in cement manufacture industry in the last couple of years. Notable acquisitions and merging include:
- Gujarat Ambuja picking up 14% in ACC
- Grasim acquiring cement business of
- L & T forming Ultratech
- Holcim taking minority stake in GACL and 67% stake in ACC
- Heidelberg Cement acquiring 50% in Indorama Cement
Global outlook for cement & construction industry
Reasonable growth in construction sector in Brazil, Argentina, Mexico and the Middle East. All in all, a great decade ahead for the cement and construction industry fueled by massive Govt. spending and private infrastructure investments.