Cement Industry’s Balancing Act: Satisfying Govt And Consumers Alike

It is a politically-sensitive commodity. Not surprisingly, it has often found itself in the spotlight? Over the last week, almost all newspapers carried flashy advertisements from cement majors such as JK Cement, Adani Cement, Ultra Tech Cement and the like wishing Prime Minister Narendra Modi for his birthday. Not just that. These ads also lauded him for the GST cut — from a heavier 28% to a lighter 18% — which will go a long way in benefitting people across the canvass. The tax reduction, they argued, will not only benefit consumers but also industries as it would boost cement demand and beef up the distribution network. Sounds like a win-win situation? There is a catch, however. Cement in India is never known to be sold at the MRP (maximum retail price)!  Several summers ago, an ad was circulated by a company claiming that it was selling cement with no ash content in it. Upon verification, it was found that none of the cement carries ashes in it! Marketing can play the perfect tool to make or mar a perception. Well, we are talking about the GST cut. Enterprises have the uncanny knack of turning any situation to their advantage. Grapevines have suggested that the cement makers have quietly upped their prices so that they are ready to bring them down when the GST 2.0 kicks in on September 22. What do we make of this? Well, more the changes, things look — nay remain — the same!