Cement prices likely to stay range-bound through September as post-monsoon demand recovery key: Report

New Delhi: Cement prices are likely to remain broadly range-bound through September as weak and uneven demand continues to limit companies' ability to sustain price increases, with a recovery in construction activity after the monsoon emerging as a key factor for the sector, according to a report by Centrum.

The brokerage said its channel checks across regions showed that cement prices remained largely stable in August, while recent price hike attempts of up to Rs 10 per bag in select markets were yet to be absorbed. It expects companies to remain focused on protecting existing price levels, with selective hikes possible in some markets.

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"Market intermediaries expect cement prices to remain broadly range-bound through September, with a healthy post-monsoon demand recovery likely to be critical for the sustainability of future price hikes," the report said.

The all-India average trade price stood at Rs 349 per bag in August, largely unchanged from the previous month and around 0.8 per cent below the Q1FY27 average of Rs 352 per bag. Prices were flat month-on-month across the Central, East, North, South and West regions.

Demand remained uneven, largely due to differences in rainfall and local market conditions. Centrum noted that 46 per cent of districts received deficient or large-deficient rainfall, while only 14 per cent received excess or large-excess rainfall.

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Heavy rainfall disrupted construction activity in parts of East India, while Central India saw the usual monsoon-related slowdown. South India continued to face weak demand and poor pricing discipline. In contrast, lower rainfall supported construction activity in parts of West India, while North India remained relatively stable.

The brokerage expects demand conditions to remain mixed in September. Continued rainfall could weigh on construction activity in the first half of the month, while a receding monsoon and the usual quarter-end push could support volumes in the latter half.

On a year-on-year basis, demand is expected to show improvement, helped by a favourable base from September 2025, when GST-related uncertainty had affected activity.

However, Centrum cautioned that a meaningful recovery would depend on construction activity normalising after the monsoon.

"Sustaining such hikes may remain challenging until demand improves meaningfully," the report said, indicating that pricing power is likely to remain dependent on a stronger recovery in demand.