Dalmia Bharat anticipates that the consolidation trend in the cement sector will persist, with leading companies projected to increase their market share to over 60% within the next two years. The company forecasts a strong rebound in sector growth, expecting a 7-8% year-on-year increase for FY26, following a more subdued growth of around 5% last year, which was impacted by the general elections and erratic rainfall patterns.
“The cement sector is poised for a recovery in demand, driven by robust needs across housing, infrastructure, and private investments. We also foresee stronger pricing and a greater focus on cost efficiencies,” said Gautam Dalmia, Managing Director, and Puneet Yadu Dalmia, Managing Director and CEO.
The rate of consolidation in the cement industry has intensified over the past three years, with the top four companies significantly increasing their share of total capacity, rising from 48% in 2021-22 to nearly 58% in 2024-25. In FY25 alone, around 52 million tonnes of cement capacity changed hands.
While the overall cement capacity in India has grown at a compound annual growth rate (CAGR) of 5-6% over the past 20 years, it is expected to expand at a slightly higher rate of 7-8% CAGR in the next few years. This growth will likely keep capacity utilization at current levels, with industry leaders expanding more rapidly and increasing their market share to more than 60% by FY27.
By FY25, the country’s total installed capacity is expected to reach approximately 670 million tonnes, bolstered by the commissioning of around 33-35 million tonnes of new capacity.
Dalmia Bharat, which achieved a cement capacity of 49.5 million tonnes per annum (MTPA) in Phase I, has set an ambitious target to increase this to 75 MTPA by FY28, with a long-term goal of 110-130 MTPA in Phase II. The company plans to reach these targets through a combination of organic growth and strategic acquisitions.
“Our Phase II expansion strategy will solidify our position as a leading pan-India cement producer, placing us on a strong path to reach our long-term goal of 110-130 MTPA,” said the Dalmia leadership. “We will focus on a balanced mix of organic growth and strategic acquisitions in the coming years.”
As part of its Phase II expansion, Dalmia Bharat will invest Rs 3,520 crore over the next two years, with plans to add 3 MTPA of cement capacity in both Pune and Belgaum. In FY25, the company added 4.9 million tonnes of cement capacity through both greenfield and brownfield projects, while maintaining a low Net Debt/EBITDA ratio of 0.3x.
The cement sector has been grappling with lower sales realization due to price weakness, which has affected the earnings of several industry players. However, Dalmia Bharat is starting to see this trend reverse.
“After experiencing a significant dip in prices during FY25 across our key regions, we are now seeing a recovery in pricing,” the Dalmia leadership noted. According to an ICRA report, the average price of cement increased by 3% year-on-year to Rs 350 per 50 kg bag in March 2025, following a 7% decline in FY25 to Rs 340 per bag.
Despite a 2% year-on-year volume growth, Dalmia Bharat’s overall revenue in FY25 fell by 4.8%, totaling Rs 13,980 crore, primarily due to price weakness. Dalmia Bharat remains committed to reducing its costs further, with plans to cut costs by Rs 150-200 per tonne over the next two years.
The company aims to achieve this by increasing its use of renewable energy, enhancing heat and power efficiency, and optimizing its supply chain through digitalization. “Our focus will be on improving operational efficiencies, and we expect to see the benefits of these initiatives flowing through in the upcoming fiscal year,” they added.
Dalmia Bharat Ltd is one of India’s leading cement manufacturers, with a significant presence in the building materials sector. Established in 1939, the company has grown into a major player, offering a wide range of cement products and services across the country.
Dalmia Bharat operates through an extensive network of plants and distribution centers, catering to various sectors including infrastructure, housing, and commercial projects. The company is known for its strong focus on sustainability, with significant investments in renewable energy and green manufacturing processes. It aims to lead the industry in environmental responsibility, with ambitious goals for reducing its carbon footprint. Dalmia Bharat is also committed to expanding its capacity and market reach, targeting 75 million tonnes (MnT) of production
