Demand for construction machinery on the rise

Monday 26, June, 2006 The burgeoning construction sector has harbingered good times for companies manufacturing construction machineries and equipment. The appreciable increase in real estate and construction activities has resulted in a surge of demand for transit concrete mixers, bar-bending and cutting machines, excavators and backhoes and earth rammers.

Bombay JCB, the Mumbai-based dealer of construction machinery giant JCB Manufacturing Ltd, has logged a considerable increase in the sale of excavators and backhoes.

"All our machineries are selling really well. We have registered a 30 per cent increase in our net sales,'' said Mr Rakesh Seth, Manager (Sales), Bombay JCB.

The Rs 9,000-crore worth construction machinery industry in the country is undergoing a steady transformation by moving from a low volume, intensive use of equipment structure to high volume, specific use one. The major segments of construction machinery that are expected to grow are excavators, loaders, dozers, dumpers and cranes, say industry analysts.

Industry major L&T has notched up a 40 per cent increase in sales in this segment over last year.

"The rapid growth in economy has accentuated the need for improving infrastructure. State Governments, development authorities and even companies have begun investing in infrastructure development projects. Moreover, the Central Government has invested heavily in irrigation and mining projects across the country. All these factors have contributed immensely to the increased use of construction machinery,'' said Mr J.P. Naik, Director, Larsen and Toubro (Machinery and Industrial Products).

Small players too gain

Smaller players such as SKG Industries and Techwin International too have benefited from the flurry of activities in the construction sector.

"We sold well towards the end of the season with several construction companies and contractors approaching us for concrete mixers and compactors. Now that the rainy season has come, the market will hit a low. But we are expecting a continuation of the present trend in the post-rain period as well,'' said Mr Javed Ansari, service engineer, S.K.G. Industries.

Exporters of construction machineries too are riding the boom wave with many bagging orders from West Asian and African countries. Most of them have managed to net huge profits with many registering as high as a threefold increase.

"Indian construction majors working on overseas projects have really opened the world for us. We are getting hefty orders from these companies to source their projects. We have also begun getting enquiries from real estate contractors and construction companies of these countries. We are working overtime to meet our demand deadlines,'' said Mr Anup Chaturvedi of Techwin International.

Rippling effect

The boom has started a rippling effect touching various other spheres of activity that are not directly related to construction. Manufacturers of ancillary products such as crane ropes, cables, pulleys and buckles too are benefited from the boom.

"We do not cater to the construction industry directly, but that does not limit us to supply crane ropes and shackles to construction companies. A lion's share of our orders, these days come from construction companies,'' sums up an official of Lift Arts which manufacture crane cables and pulleys.

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