Propelling Growth of Indian PVC Industry
Plumbing systems, methods and solutions have evolved over time, like the other components of the construction industry in India. Plumbing has been brought in the forefront as a significant element of the building ecosystem due to water scarcity and the enhanced awareness of water conservation. The PVC industry in India is valued at over Rs. 20,000 crores (reportedly estimated); with five major producers and over 6,000 plumbing processors and industrial products. Poly Vinyl Chloride (PVC) industry has over the years proved to be extremely consequential for national economy. As the third largest selling plastic commodity after polyethylene & polypropylene it has an edge over other materials owing to its productive properties like corrosion resistant, flame resistant, easy to install, handle, environmentally sound, durable, cost efficient, chemical resistant, low cost, recyclable with a long shelf life. Thus it has proved to be valuable substitute for wood, metal, concrete clay and various other applications.
The Economics of PVC
The Indian PVC Pipes Market size was valued at $3,159 million in 2016 and is anticipated to expand at a CAGR of 10.2% to reach $6,224 million by 2023. Despite of the country’s strong, consistent, economic growth, India still has a long way to go to realize its full potential of infrastructural needs and cash-onto the opportunity. Nearly USD 650 billion approx is required for urban infrastructure in the next 20 years. However, the demand has grown by almost 1.6 million tons that has opened doors to a sea of investment opportunities for construction and real-estate sectors as these industries contribute exponentially to the country’s infrastructure development. Indian import duties on PVC are lower than those in the developed world and in the ASEAN Region. Imports of PVC, which were less than 5% of the country’s demand ten years ago, are now at almost 50% and growing rapidly every year and are expected to reach to $3 billion in next few years.
Demand and Key Players
The India pipes and fittings market is fragmented with a large number of players competing in the market. Upsurge in the demand for pipes in the irrigation sector, sanitation and building construction is the major driving factor for Indian PVC pipes market. The key players operating in the India PVC pipes market are Aashirvad Pipes, Supreme Pipes, Astral Pipes, Finolex Industries Ltd., Prince Piping System, Ori-plast, Utkarsh India, Dutron Group, Kankai Pipes, and Captain Pipes. Other important players are Mexichem, Radius Systems Ltd., National Pipes & Plastics, Georg Fischer Ltd., REHAU, Uponor, Astral Pipes, Yonggao Co., Ltd., Vinidex Pty Ltd, COEMAC and Adequa Water Solutions, S.A.
Future Outlook
Increased focus of government on rural water management supports the demand for PVC pipes in India. Conversely, rise in awareness towards clean water supply in rural areas and increase in investment in the developing regions of the country are anticipated to offer growth opportunities in the market. With the Government of India strategic focus on irrigation, housing and sanitation and through schemes such as Housing for all, making 100 smart cities has opened immense opportunities for the sector propelling future growth. Schemes and programs such as PMKSY (Pradhan Mantri Krishi Sinchayee Yojana) will increase the demand for PVC pipes, keeping the industry growth strong over the next five years.
Due to issues such as demonetization, RERA, GST, and the NBFC funding crisis, the building material industry has had a setback, with the pandemic COVID-19 adding to the vows. However the organized plumbing pipe segment was relatively less affected. On a positive note the government’s relief measures for the real estate sector announced from April 2020 to August 2020 has helped the sector achieve high liquidity in the system, including compliance under RERA and IBC and also reduction in taxes to boost housing demands which has resulted importunity for plumbing and piping sector.
