As per a recent report prepared by rating agency Fitch, India's cement production capacity was 201.3 mtpa in FY08 vis-a-vis 167.7 mtpa demand. Capacity went up to 236.9 mtpa compared to total demand of 181 mtpa in FY09.
The agency further said that the demand-supply imbalance would reach to its highest level in FY13 to 125.8 mtpa with capacity going up to 392.8 mtpa.
Fitch had said that the continued overcapacity in cement sector would exert further pricing pressure on the commodity in 2011, leading to squeezed margin for the manufacturers.
"We forecast around 10% demand growth and over 12% capacity addition in 2011. The overcapacity is likely to result in pricing and consequently margin pressures for most cement companies," it had said.
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