Cemindo Gemilang's Q3 Sales Surge: Cement Industry Prospects Brighten with Government Support for Housing and Infrastructure Sectors
Thursday, 31 October 2024
Jakarta, October 31, 2024 – The cement industry is showing strong recovery, with national cement sales volume in Indonesia up by 31% in Q3 compared to the previous quarter. This growth has been driven mainly by increased demand for bag and bulk cement, particularly in Sumatra and Java. Overall, the domestic market recorded moderate growth of 0.82% as of September 2024, compared to the same period last year.
Cemindo also reported a significant 37% rise in sales volume in Q3 compared to Q2, with bag cement sales increasing by 42%, driven largely by demand in Sumatra’s regional market.
In Vietnam, where a Cemindo subsidiary operates, the domestic cement market has started showing signs of recovery. However, construction and property activities slowed due to the September typhoons, leading to stagnant domestic consumption up to September 2024 compared to last year.
By September 2024, Cemindo reported revenues of IDR 6.5 trillion, with clinker and cement segments contributing 92% and cement downstream making up 8%. Cement downstream grew by 2% over the same period last year, with a 24% increase in sales and a 60% rise in EBITDA. Cemindo remains committed to expanding its business in the building and materials sector.
Outlook for Q4-2024 and 2025
The cement industry is expected to continue its growth trajectory through the end of 2024, supported by normalized manufacturing activity post-elections and the commencement of a new administration. President Prabowo Subianto’s commitment to the development of the new capital city also bolsters optimism for industry stakeholders.
Additionally, recent benchmark interest rate cuts—50 basis points by the Fed and 25 basis points by Bank Indonesia in September—offer a positive catalyst for the cement industry, with potential declines in mortgage rates and increased infrastructure and property activity.
The government’s support for housing and infrastructure, especially through the planned construction of 3 million new homes expected to begin in early 2025, is projected to boost cement sales volume by approximately 6%-8% and support cement price stabilization.
Cemindo remains focused on growing its cement derivatives business as a new growth pillar while committed to innovation and responsible sustainability practices. With its extensive operational network, Cemindo is prepared to support development across Indonesia.
