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A report on india's engineering sector

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  • 1. Presentation by P MadhusudhanaPrabhu
    March 2011
    A Report on India's Engineering Sector
  • 2. Introduction
    Classification of Engineering Sectors
    Key user Industries
    Growth Factors
    Trends
    Opportunities on the defence sector
    Opportunities in engineering services
    Future Outlook
    Preview
  • 3. Classification of engineering sector
    Heavy Engineering
    Transport Equipments
    Capital Goods
    Other Machineries
    Sub Sectors –
    - Textile, Cement, Sugar,
    Rubber machinery… …Dairy, Mining, Machine tool ,Metallurgical etc.,
    Light Engineering
    Low Tech –eg., castings, forgings, fasteners , etc.,
    Highly sophisticated equipments
    Diagnostic Medical
    Sub Sectors –
    - Medical /Surgical, Process control equipments, steel forgings, Ferrous castings, etc.,
  • 4. Key user industries
    These industries are in turn dependent on the growth factors .
    Illustration of Key user industries
    Indian Engineering Sector Growth
  • 5. Industrial Majors
    Refining, Automotive, Textiles
    Power utilities
    Generation, Transmission, Distribution
    Retail Consumers
    Pumps and motors
    Government
    Public Investment
    Key user Industries contd…
  • 6. Growth Factors
    Well developed demand conditions
    India’s labour cost advantage
    Growing capabilities of Indian engineering firms
    Preferred outsourcing destination
    Government initiatives with respect to power, infrastructure etc.,
    Dilicensing , removal of tariff protection , promotion of SEZ’s …
  • 7. Growing trend of engineering exports
    Source : - EEPC India , December 2010 survey
  • 8. Statistical scenario :
    Exports of Engineering Services : -
    FY 09 - $ 4.9 bn
    CAGR 17.6 % over Fy07 and Fy09
    Potential to reach $ 29 bn in 2015
    = 20 % of Global market share
    Opportunity for 2009-2014 ( 5 year period) ~ $ 62 billion
    Sectors :-
    Automotive Sector = 19 %
    Aerospace = 8 %
    Utilities = 3 %
    Telecom = 30 %
    Opportunities in Engineering Services
  • 9. Global scenario
    Global military expenditure – 2008 = $ 1464 billion
    2007 = 4 % increase.
    Indian scenario
    Among top ten nations in military expenditure
    Defence budget growth at CAGR =11.5 % between FY 06 & FY 09 to $ 26.5 bn for FY 09
    MSME sector outlook
    Now ~ 5000 companies
    20-25 % of components , sub-assemblies to state owned companies
    Govt & Pvt sector participation
    Major sector = communications & IT equipment
    Opportunities in Defence Sector
  • 10. Entry of International companies
    100 % FDI route permitted – entry of international players
    Incresing the competiveness of the industry .
    Migration to value added products
    Focus on improvising capabilities
    Quality consicious
    Technology up gradation at par with global market needs
    Focus on R&D and product development efforts .
    Diversification of Risk
    Eg., L & T moved into power equipment manufacturing , BHEL plans to exporting to Syria and Vietnam etc.,
    Key Trends
  • 11. Major sectors :
    Defence
    Aerospace
    Telecom equipment
    IT equipment
    Power utilities etc.,
    ~ THE END ~
    Future Outlook