July 17, 2013 (LBO) – Sri Lanka’s Tokyo Cement said demand is expected to recover from a contraction in the first quarter of 2013 and medium term growth is estimated at 10 percent a year. Tokyo Cement, a joint venture with Japan’s Nippon Coke and Engineering Company Ltd, operates grinding plants in Trincomalee port in northeastern Sri Lanka.
In 2012 cement demand rose 12 percent but in the first quarter of 2013 demand fell 7 percent, the firm said.
“During 2012, the momentum of residential housing construction slowed down, and in the first quarter of 2013, private tourism related constructions too, indicated signs of slower growth,” managing director S R Gnanam told shareholders in the annual report.
“Meanwhile, the SME contractor segment, that makes up the backbone of the domestic construction industry, experienced severe liquidity constraints.
“The small scale contractor segment was adversely affected both by the rising cost of credit, the credit ceiling and cash flow delays. This situation reined-in construction growth momentum and dampened demand for cement, that would otherwise have been higher.”
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