Cement Industry in Nepal

1. "Nepali cement is meeting only 75 percent of domestic demand, according to the Cement Manufacturers Association of Nepal. Cement and clinker worth Rs 4.53 billion have been imported in the first nine months of the current fiscal year, according to the Trade and Export Promotion Center. Cement is imported from India and the big development projects in Nepal are using imported cement. " 
2. "Entrepreneurs claimed that the projects are buying foreign cement due to the waiver in customs duty and value-added tax (VAT) while importing construction material for the national priority projects."
3. According to the Cement Manufacturers Association of Nepal (CMAN), the domestic cement industry has an installed production capacity of 5.58 million tonnes annually which is slightly higher than the annual demand of 5.42 million tonnes. However, cement manufacturers say their plants could have utilized their full capacity except for supply side constraints and government apathy.
   
   However, this hasn’t stopped the private sector from entering this sector in a big way. Currently, there are 42 factories in operation producing 3.90 million tonnes of cement annually. Local production fulfils about 72 percent of the requirement and the rest is met by imports from India. Nepal produces OPC, PPC and PSC cement, of which OPC is preferred these days.
   
   Out of the 42 factories, only 10 also produce clinker, a major raw material used in cement production. Nepal used to depend on India for 90 percent of its clinker requirement. However, with more factories now setting up clinker production units after acquiring limestone quarries, imports from India will decline in the coming years.
   
   With these upcoming projects and capacity enhancement at a number of existing cement factories; the country will be able to substitute around 80 percent of its cement imports from India within the next few years.
4. The Bureau of Standards and Metrology reasoned that the big projects cannot trust domestic cement as the majority of manufacturers take permission for one brand and produce another. Only 22 cement factories have obtained Nepal Standard (NS) mark from the bureau till now.

Source: KP,Karobar,THT
Here is an excellent report on Nepali cement industry analysis. 

Our Analysis in of the cement industry in Nepal 

• Foreign Investors and Foreign contractors operating in Nepal prefer high quality cement, mainly imported  from India. They simply do not trust quality of cement made in Nepal. With increasing foreign Investment in Mega Hydro projects, investing in  cement factory producing high quality cement will be a viable options for the  potential investors. 
• Valuation of a cement company: If a potential investor is planning to buy an existing cement company, the investor should not may more than NPR 5000 per tone.... 

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