Archive · 13 Nov 2025
India's Cement Industry Poised for Rs 1.2 Lakh Crore Capex Boom by FY28
Imagine India needs a lot more cement to build roads, houses, and buildings.
To make sure there's enough cement, big cement companies are planning to spend a lot of money, about 1.2 lakh crore rupees, over the next few years.
They plan to build new factories and expand existing ones to make about 160 to 170 million tonnes more cement by 2028.
This is a big jump, much faster than they grew before.
The companies are doing this because people are demanding more cement.
A lot of this new building will happen at places that already make cement, which is easier and cheaper.
Even though they are building a lot, they are also investing some money in clean energy to be more efficient.
This big investment should help them meet the growing demand.
India's cement sector anticipates a Rs 1.2 lakh crore capital expenditure boom between FY26 and FY28.
The industry is projected to add 160-170 million tonne capacity by FY28, a 75% increase from the previous three years.
Demand growth, averaging 30-40 MT annually and driven by infrastructure and housing, is the primary catalyst for capacity expansion.
Approximately 65% of the new capacity will come from brownfield projects, offering financial leverage and lower costs.
A portion of the capex, around 10-15%, will be allocated to green energy and improving cost efficiency.
- Who
- India's cement industry, including major cement companies, and Crisil Ratings
- What
- Significant capacity addition and capital expenditure, with an expected Rs 1.2 lakh crore investment and 160-170 million tonne capacity increase by FY28.
- When
- Between FY26 and FY28, with some commissioning expected in the current fiscal.
- Where
- India
- Why
- Driven by healthy incremental demand growth, particularly from infrastructure and housing segments, and the financial advantages of brownfield expansions.
Capacity Addition Forecast
Capacity Commissioning in Current Fiscal
Capacity Growth Projection
Capacity Addition Forecast
The cement sector is projected to add 160-170 million tonnes of capacity between FY26-FY28.
Capacity Commissioning in Current Fiscal
Anand Kulkarni of Crisil Ratings notes that while overall capacity addition is strong, the commissioning of 70-75 MT in the current fiscal may lead to moderated capacity utilization in the near term.
- Total Capex (FY26-FY28)
- Rs 1.2 lakh crore
- Projected Capacity Addition (FY26-FY28)
- 160-170 million tonne
- Capacity Addition Growth vs. Previous 3 Years
- 75% higher
- Expected Annual Demand Growth
- 30-40 MT
- Capacity Utilization (Last Fiscal)
- 70%
- Average Capacity Utilization (Last Decade)
- 65%
- Demand Growth CAGR (Last 3 Years)
- 9.5%
- Brownfield Project Share in Capacity Addition
- 65%