Cement demand expected to remain healthy in Q1FY27 despite margin pressures. Government capital expenditure surged 26 percent year-on-year to reach 2.3 trillion rupees in February 2026, providing strong support for infrastructure-driven demand. However, Nuvama maintains a neutral stance on the sector due to profitability concerns. While cement price hikes initiated in early April aim to offset rising input costs, the gains may prove insufficient to protect margins. The residential real estate market continues to weigh on overall demand, with launch volumes declining 28 percent during January-February 2026. Central government spending momentum accelerated significantly with a 60 percent year-on-year jump in February after consecutive declines.
