However, cement demand is largely inelastic and forms just 12% to 14% of an affordable house cost and even lower for mid-premium projects.
While this cut in GST is most likely to be passed on to consumers, part of that benefit could be retained in cement pricing, which is likely to reflect on the margins of these companies.The new GST rates will take effect on September 22. This is also a confirmation of multiple CNBC-TV18 newsbreaks that were reported a few weeks earlier.
A cut in GST could also bring down prices, which could result in an increase in the consumption and thereby provide a potential boost to volumes of these cement companies.
Shares of UltraTech Cement are up 11% so far this year, while those of Shree Cement are up 18% so far in 2025. On the flip side, ACC shares have been underperformers so far in 2025, declining 10% so far, while those of Ambuja are up 7% during the same period.
(The GST Newsbreak Was By Timpuria.