BUSINESS OVERVIEW
JSW Cement is among the top three fastest-growing cement manufacturers in India (Fiscal 2015–2025), based on installed grinding capacity and sales volume growth, and ranks among the top 10 cement companies by installed capacity and sales volume as of March 31, 2025, as per the CRISIL Report.
Between Fiscal 2023 and Fiscal 2025, installed grinding capacity grew at a CAGR of 12.42% and sales volume (excluding JSW Cement FZC) at a CAGR of 15.05%, outperforming the industry average of 6.23% and 8.12%, respectively (CRISIL Report).
As of March 31, 2025:
Installed Grinding Capacity: 20.60 MMTPA
Southern region: 11.00 MMTPA
Western region: 4.50 MMTPA
Eastern region: 5.10 MMTPA
Installed Clinker Capacity: 6.44 MMTPA (including JSW Cement FZC)
JSW Cement is undertaking greenfield and brownfield expansion projects to reach 41.85 MMTPA grinding capacity and 13.04 MMTPA clinker capacity, establishing a pan-India footprint.
The company is India’s largest manufacturer of Ground Granulated Blast Furnace Slag (GGBS) with an 84.00% market share (Fiscal 2025, CRISIL Report). Green cementitious products (GGBS, PSC, PCC, others) accounted for 77.41% of sales volume in Fiscal 2025. The Clinker to Cement Ratio stood at 50.13% in Fiscal 2025 and 46.60% in Fiscal 2024, significantly lower than the peer average of 66.43% (Fiscal 2024, CRISIL Report).
Operations began in 2009 with a grinding unit in Vijayanagar, Karnataka, and have since expanded across southern, western, and eastern India and the UAE. The product portfolio includes blended cement (PSC, PCC, PPC), GGBS, OPC, clinker, and allied products like RMC, screened slag, construction chemicals, and waterproofing compounds.
As of March 31, 2025, JSW Cement operated seven plants in India:
1 integrated unit
1 clinker unit
5 grinding units
Located across Andhra Pradesh (Nandyal), Karnataka (Vijayanagar), Tamil Nadu (Salem), Maharashtra (Dolvi), West Bengal (Salboni), and Odisha (Jajpur and Shiva Cement Limited clinker unit).
JSW Cement FZC operates a clinker unit in the UAE, supplying to the Dolvi plant and third-party customers.
To secure raw material supply, the company holds rights to 11 limestone mines in India with an aggregate limestone reserve of 1,089.09 MMT (as of March 31, 2025). Four mines are operational; two more will be commissioned shortly. Additionally, five mines are under letters of intent and one operational mine is held in the UAE with 193.58 MMT of reserves.
Long-term contracts with JSW Steel Limited and another major steel producer ensure reliable blast furnace slag supply. Most plants are strategically located near mines and steel plants, ensuring cost-effective logistics. For example:
Nandyal integrated unit is 1 km from its captive limestone mine.
Grinding units in Vijayanagar, Dolvi, and Salem are co-located with JSW Steel plants.
Jajpur unit is 13 km from a key third-party steel plant in Odisha.
JSW Cement reported the lowest CO₂ emission intensity among Indian and global peers.
Fiscal 2025: 258 kg/tonne
Fiscal 2024: 270 kg/tonne
Fiscal 2023: 206 kg/tonne
This was ~52–62% lower than Indian peers and 54% lower than global cement leaders (CRISIL Report).
Sustainability is driven by circular economy principles, utilizing industrial by-products like blast furnace slag, Al-killed slag, AOD slag, fly ash, red mud, and chemical gypsum.
Thermal Substitution Rate (TSR) reached 16.39% in Fiscal 2025, aided by alternate fuel systems at Nandyal, Shiva Cement, and UAE units. Green power (solar, WHRS) supplements energy needs, with plans for expansion.
As of March 31, 2025, the sales and distribution network included:
4,653 dealers
8,844 sub-dealers
158 warehouses
6,559 direct customers (builders & institutional buyers)
Distribution is supported by a strong regional brand presence and synergy with the JSW Group, a diversified conglomerate operating in steel, energy, infrastructure, realty, e-commerce, paints, sports, and more. Access to group companies ensures material and power sourcing, while the JSW brand, under the leadership of Mr. Sajjan Jindal and Mr. Parth Jindal, enhances market trust.
JSW Cement also received capital backing in CY2021 from AP Asia Opportunistic Holdings (Apollo Global), Synergy Metals Investments Holding Limited, and the State Bank of India. As of March 31, 2025, the comapny had 1,618 on-roll employees. The Bankers to the coampny are Bank of Bahrain and Kuwait, RBL Bank Limited, Axis Bank Limited, YES BANK Limited, DCB Bank Limited, Kotak Mahindra Bank Limited, Indian Bank, Industrial and Commercial Bank of China, Mumbai Branch and The South Indian Bank Limited.
INDUSTRY ANALYSIS
Indian Cement Industry Overview
The Indian cement industry is on a growth trajectory, propelled by strong government thrust on infrastructure, housing schemes, and steady recovery in commercial and industrial construction. With supportive budget allocations and robust demand fundamentals, the sector is poised for sustained expansion through Fiscal 2030.
Budgetary Capital Outlay and Infrastructure Focus
For Fiscal 2026, the central government has earmarked a capital expenditure of ₹19.79 lakh crore, marking a 16.4% rise over the revised estimates of Fiscal 2025. A significant portion—₹10.7 lakh crore—has been allocated specifically to infrastructure ministries, reflecting the government’s continued commitment to developing roads, railways, housing, and urban facilities. These allocations are expected to stimulate long-term cement demand.
Additionally, the government has proposed ₹1.5 lakh crore as interest-free loans to states for infrastructure development and reforms. This move, along with a ₹10 lakh crore monetisation target under the second phase of the National Monetisation Pipeline, is expected to further unlock infrastructure investments.
Roads & Railways: Core Demand Drivers
The Ministry of Road Transport and Highways (MoRTH) has seen its budget double since Fiscal 2019, stabilizing at ₹2.72 lakh crore in Fiscal 2026, which will be funded entirely through Gross Budgetary Support to reduce dependence on borrowings. The National Highways Authority of India (NHAI) continues to aggressively monetise its assets, aiming to unlock over ₹50,000 crore in Fiscal 2025-26.
The government is also promoting a revival of the Build-Operate-Transfer (BOT) model to alleviate fiscal pressures, allowing private developers to finance projects entirely. Meanwhile, the railway sector will maintain a capital outlay of ₹2.65 lakh crore, focusing on three critical corridors—energy, cement and mineral transport, port connectivity, and high-density routes—under the PM Gati Shakti initiative. These developments will enhance logistics efficiency and lower freight costs, directly benefiting cement logistics.
Urban Infrastructure and Metro Expansion
Urban development remains a high priority, with ₹31,106 crore allocated for metro and Mass Rapid Transit Systems (MRTS) in Fiscal 2026, a 26% increase over the previous year. The Smart City Mission and AMRUT schemes have made significant headway, with over 7,500 out of 8,063 projects completed by March 2025.
To further this momentum, ₹10,000 crore has been allocated for developing 500 additional smart cities, focusing on sanitation, transportation, water supply, and affordable housing—all of which require significant cement input.
Affordable Housing: Rural Push Gains Momentum
The Pradhan Mantri Awas Yojana (PMAY) continues to be a key pillar for cement demand, especially in rural areas. The announcement to construct an additional 3 crore houses over the next five years will substantially address housing shortages and spur incremental cement consumption.
Under PMAY-Urban, around 81% of the earlier 1.2 crore housing target has been met, with a ₹3,500 crore allocation for the next phase in Fiscal 2026. PMAY-Gramin also witnessed a 68% increase in targets, with 83% of sanctioned homes already constructed as of March 2025. These initiatives are expected to revive the affordable housing segment, which had seen a shift in developer focus toward premium housing.
Capital Investment Outlook for Cement Sector
The industry has seen ₹1,300–1,350 billion in capex between Fiscal 2021 and 2025, focusing on capacity expansion and debottlenecking. Riding on robust demand and sound financials, major players plan to invest ₹1,600–1,700 billion over the next five years to commission 250–260 MTPA of grinding capacity, a 20-25% increase over the previous period. Much of this will be internally funded by large players due to improved cash flows and balance sheet strength.
Cement Demand Growth: Recent Trends and Outlook
Despite pandemic-related disruptions, India’s cement demand grew at a 7% CAGR between Fiscal 2020 and 2025. The years 2022 to 2024 saw a surge, led by rural housing, infrastructure, and pre-election spending. Fiscal 2023 saw 12% growth, while Fiscal 2024 posted 11% growth on a high base.
In Fiscal 2025, demand moderated to 5% due to slowdown in state capex and execution delays under PMAY-U. However, rural housing held up, supported by improved farm income.
For Fiscal 2026, CRISIL expects a rebound, with growth estimated at 6.5–7.5%, driven by:
10% rise in capex for core infrastructure ministries
Recovery in PMAY-U and PMAY-G execution
Continued traction in industrial and commercial demand
Supportive monsoons and farm income, boosting rural construction
Over the long term (Fiscal 2026 to 2030), demand is projected to grow at a CAGR of 7.5–8.5%, outpacing the previous five-year average.
Product-Wise Cement Demand Trends
The Indian market continues to witness a shift toward blended cement. As of Fiscal 2025:
Ordinary Portland Cement (OPC) share declined to ~24%
Portland Pozzolana Cement (PPC) remains the most widely used, owing to its cost-efficiency and eco-friendliness
Portland Slag Cement (PSC) and Composite Cement are gaining momentum, especially in regions near steel plants due to availability of slag
The blending ratio increased from 1.42 in Fiscal 2020 to 1.47 in Fiscal 2025, driven by higher adoption of PPC, PSC, and composite cement. As realizations come under pressure, cement producers are optimizing costs by pushing high-blending, low-carbon products, which also meet emission norms.
End-Use Segmentation and Shifting Demand Shares
Cement consumption in Fiscal 2025 was split as:
Housing: 55–57%
Infrastructure: 29–31%
Industrial & Commercial: 13–15%
While housing continues to dominate, its share is expected to slightly contract due to slower urban real estate growth. However, rural housing remains strong due to low concretisation rates and government incentives. The share of infrastructure is projected to rise to 31–33% by Fiscal 2030, supported by sustained public investment. Industrial and commercial demand will remain steady at 12–14%, driven by PLI schemes, warehousing, and real estate expansion.
Blast Furnace Slag and GGBS: A Critical Raw Material
India produced ~100 million tonnes of hot metal in Fiscal 2025, generating around 37 million tonnes of blast furnace slag, with cement manufacturers consuming 65–70% of it. With planned capacity additions by steel majors such as Tata Steel, JSW, SAIL, and AMNS, hot metal production is expected to grow at 8.0–8.7% CAGR through Fiscal 2030, boosting slag availability to ~55 million tonnes.
This slag is processed into Ground Granulated Blast Furnace Slag (GGBS), which enhances the strength, durability, and eco-friendliness of concrete. Studies by institutions like IIT and CRRI validate GGBS’s performance in construction. Its share in total slag use is projected to increase from 20–25% to 25–30% by Fiscal 2030.
Limestone Mine Auctions and Bidding Trends
The expansion of India’s cement industry hinges significantly on the availability of limestone, which constitutes nearly 85% of the total raw material cost. Besides cement, limestone is vital for industries such as iron & steel, chemicals, sugar, glass, fertilizers, and paper. Approximately 97% of the limestone produced in India is cement-grade, with chemical and other industrial grades making up the remaining 3%.
India’s mining sector is regulated by the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act). A pivotal amendment in 2015 mandated that all new mining leases be allocated via auction, leading to a steep rise in limestone mining costs due to higher premiums and royalty hikes (from ₹72 to ₹90 per tonne). Furthermore, the 2016 amendment required an additional transfer fee (80% of royalty) for transferring captive mining leases—posing a barrier to mergers and acquisitions. This led to a 7% increase in limestone prices in FY16, crossing ₹500 per tonne.
However, the MMDR Amendment Bill, 2021 reversed this by scrapping the additional transfer fee. This reform facilitated smoother transfer of mining leases, particularly benefiting companies acquiring distressed assets. The amendment helped cap the raw material cost increase to ~10% in FY22 after witnessing a ~3% drop in FY21, despite ongoing pressure from rising premiums and royalties.
Distribution of Limestone Reserves in India
As per the Indian Minerals Yearbook 2023, India holds substantial reserves of cement-grade limestone estimated at 227 billion tonnes—with 19 billion tonnes classified as "proved" and the remaining 208 billion tonnes as "possible".
Although limestone is spread across 24 states and 3 union territories, the reserves are concentrated in 10 states which account for ~93% of the total proved reserves. These include:
Rajasthan (23%)
Andhra Pradesh (13%)
Madhya Pradesh (12%)
Chhattisgarh (11%)
Karnataka (10%)
Telangana (7%)
Tamil Nadu and Gujarat (6% each)
The remaining 12% is distributed among states like Maharashtra, Himachal Pradesh, Meghalaya, Odisha, Uttar Pradesh, and others.
However, environmental regulations, hilly terrains, and protected zones such as forests and coastal regulation areas (CRZ) restrict the exploitation of these reserves. Roughly 30% of limestone-bearing areas fall under forests, and another 7.5% under CRZ, making them inaccessible for mining.
In terms of cement manufacturing capacity as of FY25:
Southern region leads with 31% share,
Eastern and Northern regions hold 19–20% each,
Western and Central regions contribute 13–14% each.
Trends in Coal Pricing
1. Domestic Coal Supply and Pricing
Coal India Ltd (CIL) dominates India’s coal production, accounting for over 74% as of FY25. Coal is sold through:
Fuel Supply Agreements (FSAs) for long-term commitments, mainly under the SHAKTI policy (for non-regulated sectors like cement, steel, and captive power).
E-auctions, which constitute ~10% of total sales and are aligned to spot market prices, often commanding a premium.
CIL follows a cost-plus pricing model, with revisions based on operational costs—particularly employee expenses (over 50% of total costs), fuel, explosives, demand-supply scenarios, and international coal prices.
In FY24, CIL increased its notified prices by an average of 8%, with G10 and G2 grades priced at ₹1,232 and ₹3,562 respectively. Including levies like royalty, GST, DMF, and others, landed costs rose to ₹3,401 for G10 and ₹6,297 for G2.
Despite the hike, the impact on power tariffs remains minimal as most power plants use lower-grade coal (G11-G13). The cement sector, relying on G7-G10 grade coal, will also see limited impact as only 15–20% of its fuel mix is domestic coal; the rest is met through petcoke and imports. Furthermore, competitive intensity and falling petcoke/imported coal prices have restricted significant rises in cement prices.
From April 16, 2025, CIL further increased the notified price by ₹10 per tonne across all grades, contributing to the Coal Mines Pension Scheme (CMPS)-1998.
2. Linkage Auctions (Under SHAKTI Policy)
To promote market-based allocation, the Ministry of Coal has revised the linkage policy:
Government-run plants are exempt from auctions.
Private IPPs must bid in auctions for long-term linkages.
Since the new system was introduced in December 2019, all non-power sector linkages are awarded via auction, where bidders quote a premium over notified prices.
As of January 2025:
Seven tranches of auctions have been completed.
A total of 173.35 MTPA was booked.
Weighted average premium across tranches I–V stood at 19.7%.
The eighth tranche of linkage auctions is currently in progress (as of May 2025).
3. Spot Auctions
CIL also conducts spot auctions for both power and non-power sectors, especially for:
Power plants without Power Purchase Agreements (PPAs).
Non-power sectors during coal shortages.
In FY25:
CIL sold 89.3 million tonnes through spot e-auction.
The average premium dropped to 48%, compared to 72% in FY24 and 253% in FY23, signaling improved coal supply.
State-wise breakdown of premiums in FY25:
NCL: 71%
ECL: 53%
CCL: 52%
SECL: Accounted for 29.2% of total quantity offered.
Conclusion: The Indian cement industry is entering a phase of high investment and evolving product mix, underpinned by government infrastructure push, affordable housing initiatives, and green cement solutions. As blended cement gains prominence and infrastructure capex continues to rise, the industry is well-positioned to sustain strong growth through Fiscal 2030.
BUSINESS STRENGTHS
Among India’s Fastest Growing Cement Companies
Ranked among the top three fastest-growing cement manufacturers in India from FY2015 to FY2025 in terms of installed grinding capacity and sales volume, as per CRISIL Report. Also positioned among the top 10 cement companies in India by installed capacity and sales volume as of March 31, 2025.
India’s Largest Manufacturer of GGBS
Holds the leading position in ground granulated blast furnace slag (GGBS) production with an ~84% market share in FY2025, leveraging a strong track record of scaling up operations in this segment.
Strategic Plant Locations with Strong Connectivity
Operates across southern, western, and eastern India, with plants strategically located near raw material sources and key markets. Facilities are connected via road and rail, including in-plant and nearby public railway sidings.
Lowest CO₂ Emission Intensity in the Industry
Maintains the lowest carbon dioxide emission intensity among Indian peers and top global cement producers, driven by a circular economy model that substitutes industrial by-products for natural raw materials.
Robust Sales Network and Brand Presence
Backed by a wide distribution network of dealers, sub-dealers, and warehouses. Trade and non-trade channels are supported by a 269-member in-house sales team and an influencer loyalty programme targeting masons, contractors, and architects.
Strong Group Backing and Resource Integration
A key entity of the JSW Group, which had consolidated revenues of ₹1,950.64 billion in FY2025 and a market cap exceeding ₹4,211.71 billion. Gains operational synergies through intra-group sourcing of blast furnace slag from JSW Steel and power via long-term PPAs with JSW Energy.
BUSINESS STRATEGIES
Pan-India Expansion Strategy
Establishing new plants in north and central India to build a pan-India manufacturing footprint, supported by capacity expansions in existing regions.
Market Penetration and Share Growth
Ranked among the top three fastest-growing cement manufacturers in India (FY2015–FY2025) based on grinding capacity and sales volume, as per the CRISIL Report. Growth to be driven by an expanded dealer and sub-dealer network, targeted marketing campaigns (including digital and sports partnerships), and influencer engagement programmes with over 57,000 members as of March 31, 2025. Continued focus on premium product innovation such as Concreel HD and customer engagement via digital platforms like the JSW Dealer Saathi and Sales Saathi apps.
Operational Efficiency and Cost Optimization
Profitability enhancement through raw material, power, fuel, and logistics cost control. Introduction of Al-killed slag as a partial limestone substitute at the Nandyal plant has reduced raw material dependency and carbon emissions. Similar initiatives are planned across other facilities. Raw material expenses accounted for 24.98% of revenue in FY2025, 21.71% in FY2024, and 19.26% in FY2023.
Sustainable Development Initiatives
Sustainability roadmap anchored in the “CO-CREATE” framework, comprising seven strategic pillars based on the JSW Group’s ESG priorities, internal materiality assessments, and industry-specific challenges.
BUSINESS RISK FACTORS & CONCERNS
Dependence on Limestone Mining
The cement manufacturing process relies heavily on limestone for clinker production. JSW Cement operates four limestone mines in India and holds rights to two more. Additionally, five mines are under letters of intent. Disruptions in securing or mining limestone at reasonable terms may adversely impact operations and financial performance.
Uncertainty Around Sambalpur Grinding Unit
A grinding unit under construction at Sambalpur by Bhushan Power and Steel Ltd (BPSL) is expected to be transferred to Shiva Cement Ltd. However, the Supreme Court has ordered liquidation proceedings against BPSL, which remain stayed. Delays, cost overruns, or failure to obtain regulatory approvals could hinder JSW Cement’s expansion plans.
High Dependence on JSW Steel Group for Raw Materials
A significant portion (92.93% in FY25) of blast furnace slag, a key raw material for green cementitious products, is sourced from JSW Steel and its subsidiaries. Loss or disruption of these supply arrangements could negatively affect operations and cash flows.
Deconsolidation of JSW Cement FZC
JSW Cement FZC, once a wholly-owned subsidiary, became a joint venture in March 2023. Its exclusion from consolidated financial statements from FY24 onward results in financials and metrics not being directly comparable with those from FY23.
Summary:
JSW Cement faces key business risks due to its reliance on limestone mining, dependency on related parties for raw material supply, legal and operational uncertainties regarding the Sambalpur unit, and changes in financial reporting owing to the deconsolidation of its UAE joint venture. These factors could impact future growth, operations, and financial stability.
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