India’s cement sector is heading into the third quarter of FY25–26 with renewed momentum, as domestic demand is projected to post double-digit growth, signalling sustained activity across infrastructure, housing and rural construction markets. Industry analysts tracking production volumes and project pipelines expect cement consumption to rise sharply during the October–December period, reflecting the broader resilience of India’s construction-led economic engine.
According to market assessments, cement demand is likely to grow by around 11 per cent year-on-year in the third quarter, driven primarily by government-backed infrastructure projects and steady uptake in the affordable housing segment. This growth trajectory underscores the material role cement continues to play in shaping India’s urban expansion, transport networks and regional connectivity.Infrastructure spending remains the central pillar supporting demand. Road building, metro rail expansion, irrigation works and public asset upgrades have maintained execution pace despite global economic uncertainty. Urban planners point out that such investments not only stimulate near-term material consumption but also anchor longer-term city resilience by improving mobility, logistics efficiency and climate-adaptive infrastructure.
Rural markets are expected to outperform urban centres during the quarter. Above-average monsoon rainfall has improved agricultural output and household liquidity in several regions, while stable wage growth has encouraged construction of homes and farm-linked infrastructure. This rural-led momentum is significant for cement producers, as it broadens demand beyond metropolitan real estate cycles and reduces reliance on premium urban pricing.Pricing, however, is expected to remain competitive. Incremental capacity additions across multiple states and heightened competition among manufacturers are likely to limit sharp price increases. Despite this, industry observers note that sustained volume growth should support overall revenue performance, particularly for producers with efficient logistics networks and lower energy intensity.
Looking beyond the third quarter, cement demand across India is forecast to grow by 7–8 per cent for the full FY25–26 period. This outlook aligns with the government’s continued capital expenditure focus, which prioritises roads, ports, industrial corridors and urban infrastructure. For cities, this translates into accelerated physical development, but also raises questions around responsible land use, emissions management and resource efficiency.Another factor influencing demand dynamics is the rise in non-trade consumption, supported by improved affordability following recent indirect tax adjustments. Price-sensitive segments, including small contractors and individual home builders, have increased offtake, contributing to broader market stability.
For India’s cement sector, the months ahead will test the balance between growth and sustainability. While demand indicators remain strong, manufacturers face mounting pressure to decarbonise operations, adopt cleaner fuels and align capacity expansion with long-term climate goals. How effectively the industry navigates this transition will shape not just profitability, but the environmental footprint of India’s rapidly evolving built environment.
