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Indian CE industry QoQ growth drops 14% in Q1 FY 2022-23

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Indian CE industry QoQ growth drops 14% in Q1 FY 2022-23

In the first quarter of the current fiscal year, sales in the Indian construction equipment sector decreased by 14% quarter over quarter (Q1 FY 2022-23). According to Mr. Dimitrov Krishnan, President ICEMA and Managing Director Volvo CE India Pvt Ltd, “While this decline comes on a higher year-end base, given that sales generally pick up in the last quarter of a financial year, the decline was also a result of slowdown witnessed in the highway construction activity from Quarter 4 of FY2021-22.” In comparison to the 26,910 units sold in the previous quarter, the Indian CE industry sold a total of 23,037 units in the first three months of the current fiscal year.

Mr. Krishnan continued, “I am extremely delighted to share that we have been able to maintain exports in Q1, FY 2022-23 (1738 units) at practically the same level as Q4, FY 2021-22. This shows our confidence in the Indian CE industry’s advances into international markets” (1874 units). This represents a 26 percent increase over the 1369 units exported in the first quarter of FY 2021–22. In our efforts to establish India as a major manufacturing and exporting country for construction equipment, we in the Indian CE industry are optimistic that we can make significant progress.

Despite a decline in revenue from one quarter to the next, a comparison with the same time the year before reveals a 59 percent increase in sales in Q1 FY2022-23. However, the growth has been noted at a reduced rate.

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Road construction equipment sales fell by 36 percent in the first quarter of FY2022-23, and then sales of material handling equipment fell by 8 percent. The 57 percent drop in highway construction that was seen during the same time period is reflected in this.

The ICEMA President stated that the general customer confidence and sentiments to invest in new equipment, particularly the hiring community, continued to be low, affecting Construction Equipment sales while highlighting some of the other factors that were impeding the growth of the Indian CE industry.

Mr. Krishnan requested the Union Government on behalf of the Indian CE industry to take legislative measures to reduce the ongoing high inflation in input materials including cement, steel, fuel, and sand, which is having a negative effect on the nation’s construction industry. In order to stay under the contractual limits, contractors frequently wait for input prices to decline to reasonable levels. In order to relieve the financial restrictions, he also asked the State Government agencies to investigate the possibility of early release of delayed payments.

A 13 percent gain in Earthmoving Equipment sales, followed by an 11 percent increase in Concrete Equipment sales, which may have been prompted by the acceleration of metro rail construction projects, stopped a more severe decrease in the industry’s sales. Sales of material processing equipment also experienced a sharp growth in the sector, rising from 165 units in Q4 FY2021-22 to 724 units in Q1 FY 2022-23.

Considering the monthly sales comparison According to Mr. V G Sakthikumar, convener of the ICEMA Industry Analysis and Insights Panel and managing director of Schwing Stetter India Pvt Ltd, the construction equipment market only experienced a 1% reduction in sales from June 2022 to June 2019. However, in the future, a resurgence in construction would be essential for regaining development in the near term, added Mr Sakthikumar.

The ICEMA Panel on Industry Analysis and Insights gathers, produces, and analyses industry data to deliver thorough and reliable market insight. The value-added quarterly CE Industry Report is one of many industry studies that have been compiled using information given by its member businesses, who account for around 95% of OEMs active in the Indian Construction Equipment market.

The national organisation for the country’s construction equipment industry (OEMs, suppliers, and FIs), ICEMA (Indian Construction Equipment Manufacturers Association), is connected to the Confederation of Indian Industry (CII).

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