HSBC sees cost relief for Indian cement makers as worries fade with softer crude

Shree Cement

17/06/2026 07:40

** HSBC Global Investment Research sees cost inflation concerns easing for India's cement firms; remains positive on the sector
** After the sharp fall in crude and PP (polypropylene) bag prices, HSBC expects packaging costs to decline from Q1 levels
     ** Says some energy cost inflation may persist in Q2, depending on pet coke booking timelines; overall, much of H1 FY27 cost pressure could reverse in H2
** Industry demand has broadly been stable in Q1 with cement price increases in April broadly covering the variable cost increase in the quarter - HSBC
** "While an energy price decline has broadly put to rest worries on earnings downgrades, for an earnings upgrade cycle, we need to see cement price hikes, which in our view requires industry discipline," - brokerage
** Shares of UltraTech Cement ULTC.NS down 0.1%, Ambuja cement ABUJ.NS down 0.4%, Shree Cement SHCM.NS rise 1.1%
** JK Lakshmi Cement JKLC.NS up 0.5%, ACC ACC.NS down 0.1%

 (Reporting by Abhinav Parmar in Bengaluru)
 ((Abhinav.Parmar@thomsonreuters.com;))