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Construction equipment players to gain from govt's infrastructure push

Total size of the industry was $3 bn in 2015 and is expected to touch $5 bn by the year 2020

Megha Manchanda  |  New Delhi 

Bharat Road Network

The government’s push — with the recently announced Bharatmala project — means gains for construction companies like JCB, and The firms are eyeing a string of highway contracts to be offered by the government.

The sector is a demand and job multiplier, Vipin Sondhi, chief executive officer and managing director of India, said. is a key player in the industry.

“There are five sectors — road, rail, irrigation, urban rejuvenation and real estate — that drive business for companies. is one of the key drivers,” Sondhi, who also serves as the chairman of the board of Excon, said.

In October, the Union Cabinet cleared the Bharatmala project to construct 20,000 km of highways connecting western and eastern parts of the country at an estimated investment of Rs 7 lakh crore. These corridors will permit faster movement of cargo vehicles. According to the government’s estimates, construction of 10,000 km of highways annually has the potential of generating 40 million man-days of employment.

As many as 42,710 units were sold between January and September, this year, against 37,346 units in the same period, last financial year. The industry that is growing at a rate of 14 per cent is expected to touch the 25 per cent-mark by the end of the current financial year (2017-18).

According to an industry expert, who did not wish to be quoted: “Since the real estate sector is down for a while, the business for the makers would mainly come from the rail and road sectors. If these two sectors see a growth of about 60 per cent, 30 per cent of that should translate into business for the construction sector players.”

The leading players in the space include Hyundai, Caterpillar, Tata Hitachi, Escorts, ACE and BEML, industry estimates show. According to such estimates, the total size of the industry was $3 billion in 2016 and is expected to touch $5 billion by 2020.

Top 10 players
  • JCB
  • Hyundai
  • Caterpillar
  • Krone
  • Tata Hitachi
  • Komatsu
  • Escorts
  • Kobelco
  • ACE
  • BEML
Source: Industry

First Published: Tue, November 21 2017. 01:31 IST