Cement – Sector Update – Cement prices holding till now, but macros worsening
Published on 01 Sep 2026
Q2 remains a seasonally weak quarter for the cement industry, and the ongoing Middle East crisis has kept P&F, freight and other operating costs elevated, increasing uncertainty around margins for H2FY27. While cement prices holding up during Aug, the peak monsoon month, is encouraging, but alarmingly lower rainfall across southern states, Rajasthan and half of MH/GJ this year doesn’t augur well for FY28 demand. A price hike in Sep’26 would provide some relief; however, in its absence, continued cost pressures are likely to weigh on margins in Q3. Hence, the sustainability of current price levels and the industry’s ability to implement further hikes will remain key monitorables going ahead. We believe this is a good time to accumulate selective companies having diversified market presence, better cost management and muted valuations. Top picks: UTCEM, JKCE & NUVOCO
