Advantages Of Cement Industry

India Advantage
Robust demand: The 12th Five Year Plan of the Government of India aims at driving growth rate at around 8%. It targets growth which is faster, inclusive and sustainable. There is an expected boom in the real estate sector, which will boost demand for cement. There is an initiative to build around 100 smart cities that will trigger further demand for cement.
Long-term potential: The cement industry will have an oligopoly market structure where small number of sellers namely, oligopolists, dominate the market. This result is less competition and high prices for consumers and higher profits. There is less threat from substitutes. If government projects are implemented the cement sector will improve further.
Increasing investments:

This has helped reduce market concentration of leading players in the cement industry. The profit margins, constant demand of cement and the right valuation multiplied foreign entrants into the market. Cement Companies will enter the global listings through the Foreign Currency Convertible Bond (FCCB) route or the Global Depository Route (GDR) route.
Tie-up with overseas: India’s deal with Switzerland to develop new methods for efficient cement production and to reduce energy consumption would help raise the demand for cement in the infrastructure sector.
Housing for All: There has been a huge demand for low-cost housing, as per the Union Budget 2015-16. There is increased focus on infrastructure development and providing housing for all, with a proposed 2 crore houses to be built in urban and rural areas across India. This will revive the demand for cement. Housing development will boost the production and consumption of cement. Earlier, the housing sector held around 67% of the total cement consumption in

According to data from VCCEdge, the Indian cement industry has seen seven M&A deals worth a total US$3.3 billion since January 2013.
The compelling reasons why domestic and foreign cement majors appear to be so bullish on India are Excess capacity of the existing players which can be used to fulfill the global demand at lower cost of production, Entry of foreign players who wanted a pie of untapped Indian market, and Rising cost of greenfield projects which also tends to have longer gestation period.
The consolidation in the cement industry would prove to be beneficial both for the acquiring companies as well as for the cement