What I Understood?
Due to Covid, government imposed lockdown in March and companies were unable to operate for a few days. In this lockdown, many labours migrated to their hometowns and thus when factories were started again there was unavailability of labour. Construction in metro cities took a halt due to lockdown and thus demand of cement was not there. Even after lockdown was lifted construction is not started with the same pace so demand is yet to increase in these cities.
On the other hand as the labour migrated to their hometowns they didn’t had much work to do. So they took the work of either constructing or repairing their own houses. Also people who wanted to start construction didn’t start but the ones who had started their construction began to finish the work. Also demand can increase before monsoon because people will try to finish some work before monsoon.
So on current situation rural areas led the demand. Now as the labours will migrate back to cities around Diwali cement demand can be increase at a substantial rate.
On costing front, some companies saw increase in freight cost while some managed it by selling higher volumes. Overall, according to companies, there were no major changes in cost.
On CAPEX, companies are delaying their CAPEX plans. One major CAPEX is done on WHRS installment. Companies are going to install WHRS which will help in reduction of fuel cost. Other CAPEX programme such as expansion of grinding units, maintenance work etc. will be delayed and also some amount of CAPEX will be reduced depending on company to company.
Sources used – https://drive.google.com/drive/u/2/folders/1BGzJuQW8pvCkiiImNXMCRYy3yrSrfRsb
The Fundamental Mindset 