Indian construction equipment sales dip 1% in Q1 FY26

The Indian construction equipment (CE) sector experienced a subdued beginning to FY26, recording a slight 1% decrease in total sales year-on-year, with 28,687 units sold during the April–June 2025 timeframe. This is in contrast to the 28,902 units sold in the first quarter of FY25. The most recent quarterly figures, gathered by the Indian Construction Equipment Manufacturers’ Association (ICEMA), indicate a widespread deceleration across key equipment categories, despite a notable increase in exports that offered a glimmer of hope in an otherwise sluggish market environment.

Domestic sales experienced a decline of almost 5% year-on-year, with 24,809 units sold compared to 26,020 units during the same quarter last year. Conversely, exports saw a significant increase of 34.5% year-on-year, rising from 2,882 units in Q1 FY25 to 3,878 units in Q1 FY26, fueled by robust overseas demand for Indian-manufactured equipment. Segment-wise, the figures indicate the persistent volatility in the execution of infrastructure projects:

This deceleration presents an opportunity for us to reevaluate the speed of infrastructure deployment, particularly at the state level. Ongoing delays in project execution continue to impact demand,” stated Deepak Shetty, president designate of ICEMA and CEO & MD of JCB India. Industry participants attribute the slowdown mainly to reduced activity in essential end-use sectors, especially in roads, highways, and mining. Regional differences have further influenced demand, with certain states experiencing an increase in infrastructure while others have fallen behind. Sector leaders highlighted that delays in government project execution and the seasonal characteristics of construction activities are significant factors contributing to the weaker quarter. V. Vivekanand, president of ICEMA, remarked that the beginning of FY26 indicates a downturn for the industry following a period of high growth in Q4, with subdued demand in critical sectors raising concerns. He emphasized the necessity of accelerating planned infrastructure initiatives to restore momentum in the upcoming quarters. Although the current slowdown is perceived as partially seasonal, the sector remains cautiously optimistic, identifying innovation, localization, and sustainability as key areas of focus. Referencing reliable data from OEMs that account for 95% of India’s CE industry, ICEMA analysts cautioned that unless infrastructure execution improves, demand may continue to be challenging in Q2 FY26. Industry leaders have urged the government to closely observe and hasten the implementation of major projects as a strategy to maintain investments and achieve ambitious national infrastructure objectives.”