Building Materials Sector Analyzed

Motilal Oswal Financial Services (MOFSL) believes that the companies making building materials – like wood panels and tiles – will start to do better around the second half of 2026 (H2FY26). This is happening because there’s still not a huge amount of unsold housing and a lot of new building projects that were planned for last year are now expected to begin.

Key Points

• India’s building materials sector poised for recovery by H2FY26.
• Low housing inventory & delayed project launches driving demand.
• Real estate growth to 18% of GDP by FY47, a key driver.
• Strong structural growth: Infrastructure, urbanization & BIS standards.
• MOFSL recommends Century Plyboards & Cera Sanitaryware.
• Analysts predict earnings & return ratios to improve by FY25-28.

The government is investing heavily in building things, and there aren’t many houses sitting empty. Also, many big building projects that were supposed to start last year are now finally beginning. This increased activity is leading to higher demand for materials like wood and tiles.

The government is also focusing on improving infrastructure and housing, and there’s a growing trend for people to live in more modern, nicer homes. This ‘urbanization’ is also increasing the demand for things like premium building products – materials that are higher quality and cost more.

A special organization called the Bureau of Indian Standards (BIS) is helping to make sure that building materials are made well. This means companies that make good-quality products are getting a boost, and struggling businesses are falling behind.

MOFSL has picked out two companies they think will do well: Century Plyboards and Cera Sanitaryware. They believe that more people will be buying homes and renovating them, and this will help these companies grow.

Even though things were tough for a while – with low sales and expensive raw materials – analysts at MOFSL think these companies will start making more money and giving better returns to their owners by 2025 to 2028.

“The building materials sector offers a strong opportunity in India driven by long-term growth trends.”