Top cement cos plan to invest ₹30,500 crore in this fiscal

Even as the revival in private capex remains a major concern, the top nine cement companies are expected to spend ₹30,500 core in this fiscal on expectations of sharp revival in demand on back of government spending on infrastructure projects

Aditya Birla Group-owned UltraTech Cement and Adani Group companies Ambuja Cement and ACC top the table with a capex plan of ₹9,000 crore each in FY26, while Dalmia Cement and Shree Cements will invest ₹3,500 crore and ₹3,000 crore each.

The largest cement producer UltraTech had increased its capacity by 44 million tonne per annum (mtpa) to 184 mtpa last fiscal with acquisition of India Cements and Kesoram Industries. The company added 27 mtpa through inorganic route and 17 mtpa through organic addition. It expects to add 21 mtpa by FY27 to take the total capacity to 211 mtpa.

Similarly, Ambuja Cements and ACC plan to invest ₹6,000 crore in growth capex and ₹2,500-3,000 crore to improve efficiency. The Adani Group companies crossed combined capacity of 100 mtpa post consolidation of CK Birla Group company Orient Cement. Adani Group plans to reach 140 mtpa by FY28, with addition of 18 mtpa targeted in FY26.

Dalmia Bharat, which added 2.9 mtpa capacity last fiscal, expects to spend ₹3,500 crore largely on new projects and maintenance projects and about ₹100 crore in renewable energy projects. The company plans to announce its second phase of expansions to achieve 75 mtpa of capacity by FY28.

It recently announced 6 mtpa capacity expansion in Maharahtra and Karnataka for ₹3,500 crore. It also aims to expand clinker capacity from 23.5 mtpa to 27.1 mtpa in FY26 and 30.7 mtpa in FY27.

Demand recovery

Pranav Mehta, Research Analyst, Equirus Securities said sub-optimal demand recovery is the main industry risk combined with aggressive capex.

In the absence of reasonable demand growth, ability of the industry to absorb incremental capacity from new projects as well as maintaining pricing discipline will be severely hampered, he said.

However, the demand from the real estate is expected to revive with the recent key bank rate cut by the RBI, he added.

Ashutosh Murarka, Cement Analyst, Choice Broking said cement prices may come under pressure due to the addition of 50–60 MTPA of fresh capacity with major players such as Ultratech, ACC and Ambuja are pursuing aggressive expansion plans.

In the eastern region, about 10-12 mtpa of new capacity is expected in FY26, even though the current capacity utilisation is already low at 62-65 per cent, which could further weigh on pricing, he said.

Similarly, capacity utilisation in the southern region was below 60 per cent and will see 10 mtpa of new capacity, potentially keeping prices under pressure in region, he added.

Published on June 12, 2025