Industrial & Electrical Machinery

Industrial manufacturing is a major growth sector for the Indian economy with diverse companies including those engaged in manufacturing of machinery and equipment, electrical and metal products, cement, building and construction material, rubber and plastic products and automation technology products. The momentum is expected to continue, with the industrial sector witnessing sustained growth and the Government committed to deliver towards this.

In line with the emergence of industry 4.0, Indian manufacturers are now looking at digitalizing their vertical and horizontal value chains from product development and purchasing to manufacturing, logistics and services. Efforts are on in forming multi-national partnerships, alliances and joint ventures in order to secure FDI, benefit from advanced technologies, and improve productivity through factory automation. While focus continues on penetrating in domestic market, Indian manufacturers are also looking to gain a foothold in the global market by increasing exports in existing markets and by exploring new geographies.

A key success determinant in these sectors is the ability to scale up in accordance with the rate at which the market is expected to grow. Willingness to invest with a long-term view and building relationships with end-user segments will be key factor. Most of the end users are very large players and will prefer an assured supply with scale benefits from a consolidated supplier base.

Given the fact that most industrial users differentiate on scale, access to business relations with such a player will, at least in the future, entail build up of a spectrum of capabilities. The Indian market is growing steadily and rapidly and strong international players with newer technologies are establishing a presence here. The existing industry players will therefore need to enter into strategic alliances and tie-ups with technology suppliers to upgrade their capabilities.

One of the crucial sectors of Indian manufacturing sector is the electrical industry which principally caters to the power sector. The industry has a diversified, matured, established and strong manufacturing base, with robust supply chain, fully equipped to meet the domestic demand and capacity additions. The sector contains significant number of SMEs and has substantial growth potential.

India’s Electrical Equipment Industry Comprises of two segments – generation equipment (boilers, turbines, generators) and transmission & distribution (T&D) and allied equipment like transformers, cables, transmission lines, switchgears, capacitors, energy meters, instrument transformers, surge arrestors, stamping and lamination, insulators, insulating material, industrial electronics, indicating instruments, winding wires, etc. The T&D equipment sector 85% of the industry whereas generation equipment sector is 15%

India has a number of advantages in the industrial and electrical machinery sector that make it an attractive investment destination. Apart from a large and growing domestic market, it also has a well-developed supplier base, availability of skilled manpower at relatively lower costs, supportive regulatory environment and good support infrastructure. All these are positive drivers for potential investors to invest in the electrical machinery industry.