Freight Rate Hike By Railways

A circular issued by Indian Railways last week shows that the season levy is increased to 10% from 7% announced in March 2011. This levy is in addition to normal tariff and is applicable to most goods transported during October-March that is considered busy season for railways. In March 2011, railways had levied a busy season charge of 5% on coke and coke group and 7% on all other commodities. Containerised cargo and certain automobile traffic continue to be exempt from this levy. 

Cement Mini Plants Economically Unviable

Woes of the cement industry in India continue. Mini cement plants are the latest victims.. Read how..

Cement Growth Lags GDP Growth

It’s for the first time in the past several years that demand for cement (up by 5%) has grown at a slower pace than GDP (up by 8.5%). Demand for cement partially reflects growth in economic activity, particularly with regards to capex.

Indian Industry News: Holcim’s raises stake over 51%

The Holcim Group has finally acquired more than 50% stake in its Indian subsidiaries–ACC and Ambuja Cement, reported Financial Express on 05 May 2011. Holcim Group on 29 April 2011, has acquired another 3.562% in Ambuja through open market purchase, increasing its stake in the company from 46.44% to 50.002%. It has also increased its stake in ACC by 0.8% and now holds 50.1%.

Cement:December 2010 Quarter Updates

Demand for cement has been weak during the December 2010 quarter. Demand was poor at 5.3% in the December quarter with the exception being October at 18 per cent. This, in turn, was largely due to restocking by agents following poor sales in the preceding four months.

Infrastructure Gets A Firm Push

Infrastructure development in India faces both financing as well as non-financing constraints. In the Economic Survey for 2010-11, the government has highlighted the need to address the following non-financing constraints that are leading to time and cost over-runs:

Coal India raises prices selectively

Reducing the import parity price of coal, Coal India for the first time ever hiked prices selectively.

Rationalisation of cement duty structure

“As a measure of relief to cement industry, I propose to replace the existing excise duty rates with composite rates having an ad valorem and specific component with some rationalisation. The basic customs duty on two critical raw materials of this industry viz petcoke and gypsum is proposed to be reduced to 2.5 %,” the Finance Minister said in his speech on the Union Budget 2011-12.

Cement Production Cut on Slow Demand Growth

Weak demand due to a heavy monsoon and a lull in infrastructure projects is likely to have depressed growth in cement despatches in August 2010.

Slow growth in industrial production could also be a hint that investment and economic activity in July slowed down. On the supply side, production capacities set up in the past 2-3 quarters have started to stabilise and yield results, keeping prices low.

ACC, the country’s second-largest cement maker, recorded a 4.9% Y-o-Y fall in sales in August.

Six Core Infrastructure Sector Gives Mixed Signals

The index of the six core industries, which include crude oil, petroleum refining, coal, electricity, cement and finished steel, has a combined weight of 26.7% in the index of industrial production (IIP).

The six infrastructure industries grew 3.9% in July, marginally higher than in June, but contraction in steel and cement has raised doubts about the overall industrial output growth, which slowed to a 13-month-low in June. This is because the performances of these sectors are considered advance indicators of overall industrial activity. While cement and steel show investment demand, the energy sectors reflect pace of overall economic activity.