Indian casting production is expected to grow at a CAGR of 12. 7 per cent from 2018 up to 2023. The foundry market is linked directly with the development of the overall automotive sector. According to Niteen Inamdar, Executive Vice President and COO, Global Operations, Sigma Electric Manufacturing Corporation, growth of the automobile industry is expected to generate huge demand for castings producers.
What is the current shape of the casting & forging industry?
Expansion of infrastructure by the government is expected to generate demand for a wide variety of machinery and equipment such as cranes, fans, motors, appliances, pumps, conveyor equipment, etc., which, in turn, will create fresh demand for metal castings. The major foundry clusters are located in Batala, Jalandhar, Ludhiana, Agra, Pune, Kolhapur, Sholapur, Rajkot, Ahmedabad, Belgaum, Coimbatore, and Chennai. Re-implementation of Public Procurement Policy, Pradhan Mantri MUDRA Yojana, Make in India, Startup India, and Skill India initiatives are helping in the growth of the MSME sector in the country.
What are the opportunities in the casting & forging industry?
Casting production in India is expected expand at a compound annual growth rate (CAGR) of 12.7 per cent from 2018 until 2023. The automobile sector consumes around 40 per cent of castings produced in India. As of 2018, aluminium castings contributed around 15 per cent of the total castings production in the country. The share is expected to increase considerably by the end of 2023, owing to a shift in demand from iron to lighter castings materials for manufacturing fuel-efficient automobiles and electronic vehicles.
What are the sectors that are seeing the most demand?
The foundry market is linked directly with the development of the overall automotive sector. Growth of the automobile industry is expected to generate huge demand for castings producers. Based on volume, India is currently the fourth largest automobile industry, globally. Rapid growth of the automotive sector has also led to the steady development of other subsidiary industries like the auto component industry, indicating huge demand for castings.
The pipe sector in India is poised for steady growth due to substantial investments and capacity additions. Companies produce a wide range of steel, cement and PVC pipes, which are used in various industries. Demand for castings is expected to expand with the growth of the pipes and fittings market in India.
Consistent power supply and availability of quality electrical equipment are necessary for the growth of the Indian economy from a global perspective. As of December 2018, India had a power generating capacity of ~349.28 GW. The Government of India has targeted an addition of ~88.5 GW under the 12th Five-Year Plan (2012–2017), and another ~100 GW under the 13th Five-Year Plan (2017–2022). The foundry industry is expected to benefit from such installations.
What kind of growth has the casting & forging industry witnessed in the last year?
Casting production in India reached a value of 11 million tonne in 2018. Foundries across India are presently upgrading facilities and technologies in a bid to improve their productivity and increase their capacity. To cater to the growing demand, this industry is embarking on major expansions and technological initiatives, with investments of over Rs 10 billion, since 2011. Majority of the foundry units in India fall under the MSME sector, which has registered consistent growth over the years. There are around 51 million MSME units spread across the country. About 55.3 per cent of the MSMEs are based out of rural areas, indicating the deployment of a large rural workforce in the sector.
What kind of challenge does the casting & forging industry face?
Two of the foremost market challenges are environmentalissues leading to increasing environmental cost and skill set availability. Since most of the castings manufacturing units fall under small and medium enterprises (SMEs), they cannot use advanced technological equipment or automation due to high costs, thus limiting their marketing strength. It is challenging for them to sustain their position in the global marketplace.