Page 64 - CV June-July 2023 Issue

However, the large expansion plans will keep capacity utilisation
below 70 per cent, up from 65 per cent in FY23. It expects 75 per
cent of the announced expansion of around 150 million tonnes is
actually likely to come on stream during FY23-25. But since most
of the capacity addition is coming in grinding units, clinker
utilisation is likely to remain 800-1,000 basis points higher than
cement utilisation, indicating a higher effective utilisation rate.

The report also sees the industry undergoing more consolidation,
especially in the south in the near-to-medium term, given the
widening gap between leading and small players amid a tough
environment and aggressive medium-term capacity targets of
large players.

The shares of top 10 companies also increased to 71 per cent in
FY23 from 69 per cent in FY20 and they are likely to increase
further in the next couple of years.
Given the high fragmentation and a large number of small-to-mid
sized players, the southern market offers a high potential for
inorganic expansion followed by the western region.

CONSTRUCTION VISION 62 JUNE-JULY 2023