Pricing power of cement companies restricted

The reduction in customs duty will arrest sharp rise in cement prices

The reduction in customs duty on cement and clinker from 25% to 20% will not lead to large scale import of cement, though the international cement prices are low.

The various infrastructure bottlenecks, the surge in transport costs and the problems of bulk handling will arrest possibility of large scale imports.

Nevertheless, the domestic cement companies pricing power is partially handicapped by the reduction in import duty. The Builders lobby is quite strong only in a very few parts like Mumbai whereas, the Cement lobby is quite strong across various parts of the country.

Nevertheless, the possibility of sharp rises in cement prices in shorter spans have been partially arrested by the reduction in customs duty.

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