Construction Equipment Industry In India

India: Construction equipment Industry Highlights
Presently Construction equipment industry in India is US$ 3.5 billion in 2008 and is expected to double at approx US$ 7-7.5 billion by FY 2009-2010
The Indian construction equipment has been growing at a scorching pace of more than 30% per annum .
The demand for construction equipments correlated with ports, pipelines, roads, steel, power projects, mining and building etc, which attracts a investment of more than $ 500 billion in next few years .
Equipment cost as a part of construction cost ranges from 4.5% to 24%.

Growth of the Industry Construction equipment industry (India) In US $ billion

India: Construction equipment Sector Snapshot

Key Indian Players In Industry

Foreign Players
UK based JCB has set up proprietary business in India – JCB India is the group’s largest market.
Terex Vectra , a 50:50 JV between Terex corp. USA and Vectra ltd. of UK has also etched its presence.
Other major tie-ups include Caterpillar with GMMCO, Komatsu with L&T , and Hitachi’s stake in Telcon (A TATA Company).
Manitowoc acquired Shirke Potain and named the entity Potain India Pvt Ltd to have a wholly owned manufacturing facility in India.
Yanmar construction company, Japan has recently announced its India foray.

Growth Drivers for the industry

Rental Equipment
The equipment rental business in India is currently pegged at around 7-8% of the total construction equipment industry which is nowhere close to what is seen in more developed markets with around 80% in Japan, 60-65% in USA and 35% in china . The Rental Equipment business in India is expected to grow to about 25% by 2010. The prominent organized players are SREI’s Quippo, Sanghvi movers, Gremach Infrastructure equipments and Caterpillar .The average cost of hiring has gone up by approximately 30-40% over the last two years.

Dominant players in the rental equipment market Industry estimates (2006-2007)

Equipment Finance in India
The Indian equipment finance market is yet to evolve. There are only 3 major players SREI Infrastructure finance , Cholamandalam DBS and Birla Global finance which cater to approximately 3% of the market as compared to 65% in developed countries. SREI also provides assistance to its customers throughout the lifecycle of the equipment and has initiated reverse auctioning of equipments in 2007.

Opportunities OPPORTUNITIES FOR GLOBAL PLAYERS

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Construction Equipment Industry In India

by Ace Global Consulting LLP on Jan 11, 2010

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