The Indian Construction Equipment (CE) industry maintained its ongoing growth momentum in the third quarter of the current fiscal year by clocking a 30% growth in sales volume over the third quarter sales in FY23. The landmark growth in Y-o-Y sales for Q3 FY24 from 27,817 units in October-December 2022 to 36,055 units in October-December 2023 encompasses robust growth in sales across all five segments.
“The CE industry crossed the 100K mark for the first time last fiscal. This fiscal it has reached close to 100K units (93,377units) within the first 3 Quarters. We are thankful to the government for having a strong focus on infra development and hope to see the momentum getting better and better in the months to come,” said Mr. V. Vivekanand, President ICEMA and Managing Director, Caterpillar India Pvt. Ltd. “Demand across all segments of the industry has been growing as a result of rapid infrastructure development in all sectors of the economy in line with the government’s consistent focus on infra-led economic growth in the nation,” he added.
Of the overall sales for Q3 FY24, 33,135 units were sold domestically and 2920 units were exported. Sale of Earthmoving Equipment which comprises the lion’s share of CE sales at around 70%, grew by 25% over Q3 FY23 levels to reach 25,087 units. Material Handling Equipment, with a concomitant 46% growth, sold 4,482 units while Concrete Equipment sales of 3,840 units comprised a 43% growth over the same period. Sales of Road Construction and Material Processing Equipment stood at 1,958 and 688 units – recording an increase of 38% and 18% respectively.
While sales of the Earthmoving segment have largely been bolstered by an increase of nearly 30% in State governments’ capex, a 20% increase in highway construction activity Y-o-Y has also been a contributing factor to growth in sales of both Earthmoving and Road Construction segments. The accelerated pace of infrastructure projects was primarily responsible for the 43% growth experienced by the Concrete Equipment segment and the 46% boost in Material Handling Equipment sales, aided by a rebound in the real estate sector in the case of Concrete Equipment and the surge in manufacturing in case of Material Handling.
On a quarter-on-quarter basis too, the overall sales volumes as well as sales in each segment registered positive growth, with overall sales up 20% as compared to 30,078 units in Q2 FY24. The segment-wise sales volumes in Q3 FY24 increased by 21% for Earthmoving Equipment, 10% for Material Handling Equipment, 15% for Concrete Equipment, 47% for Road Construction Equipment and 4% for Material Processing Equipment.
“We are very pleased with the sales growth in Q3 of the current fiscal and expect the positive trend to continue over the remainder of the year,” said Mr. Jaideep Shekhar, Convener, ICEMA Industry Analysis & Insights Panel and Managing Director – Asia, Australia & EMEAR, Terex India Pvt. Ltd. “Given the government’s directive to expedite spending of the budget allocation for the infrastructure sector for timely completion of projects in the pipeline, we are confident that this ongoing momentum will translate into around 20% growth in CE industry sales over the whole of FY24,” he explained.
The Indian CE industry’s performance in the current fiscal year has been bolstered by the Government’s continued emphasis on infrastructure in the form of enhanced Budgetary allocations, as well as rapid implementation of projects in the run-up to the General Elections. As a result, the overall sales figures for the CE industry in the current fiscal year have been consistently higher than those in FY 2022-23, in terms of both domestic sales as well as exports.
Mr. Vivekanand, further added, “We at ICEMA request the government to ensure that the steady pace of execution of projects is maintained, which is critical for the consistent growth and development of the Construction Equipment industry.”
The ICEMA Panel on Industry Analysis and Insights provides robust and credible market intelligence by collating, generating, and analysing industry data. The value-added quarterly CE Industry Report is among the several industry reports collated based on data shared by its member companies which represent about 95% of the OEMs operating in the Indian Construction Equipment industry.
ICEMA (Indian Construction Equipment Manufacturers Association) is the nodal body representing the Construction Equipment industry (OEMs, suppliers and FIs) in the country and is affiliated to Confederation of Indian Industry (CII).