New Delhi:  India’s cement industry is poised for a wave of consolidation as demand continues to rise sharply, according to Moody’s Ratings.

Large cement producers are acquiring smaller regional players to expand capacity and maintain competitiveness amid growing consumption.

Over the past five years, top 10 cement companies in India have acquired around 140 million metric tonnes per annum (MMTPA) of capacity, valued at Rs 890 billion (USD 10.5 billion).

This trend is expected to continue, with major players like UltraTech and Ambuja leading mergers and acquisitions, particularly targeting regional producers with lower profitability.

South India remains the most exposed to this consolidation due to its high number of small cement firms and a production capacity exceeding 200 MMTPA. The region outpaces the North and East, each with about 150 MMTPA.

Moody’s forecasts India’s cement consumption to grow at a compound annual growth rate (CAGR) of 6–7 per cent through 2030, driven by housing demand and infrastructure projects. To meet this, the industry is expected to expand capacity by a third in five years.

Top producers plan to add 200 MMTPA by FY28, with UltraTech and Ambuja contributing 30 per cent of the growth. Shree Cement and Dalmia Bharat will account for another 25 per cent, while smaller firms like JK Cement and JSW Cement aim to double their current capacity.

India’s per capita cement use stands at 260 kg, far below the global average of 540 kg, indicating room for growth. However, Moody’s warns that volatile raw material costs and regulatory changes, such as taxes on limestone mining and reliance on imported fuel, could impact profit margins.

Despite these challenges, the cement sector is expected to remain robust, buoyed by steady demand and strategic consolidation.