The document discusses India's engineering industry. It is a large and growing sector driven by increasing infrastructure investment and industrial production. Key segments include heavy, electrical, automotive, and light engineering. The industry faces challenges from competition and supplier/customer bargaining power. Major players include Larsen & Toubro and Bharat Heavy Electricals. The industry is expected to continue growing strongly due to rising demand from power, mining, oil/gas and other sectors. The government supports growth through policies promoting investment, exports, and manufacturing.

1. ENGINEERING
INDUSTRY
IN INDIA

2. Challenges
Market size
Introduction Growth

3. ENGINEERING INDUSTERY
Engineering
Heavy Engineering
Heavy Electrical
Heavy Engineering and Machine Tools
Automotive
Light Engineering
Low Technology Products
High Technology Products

4. CHALLENGES
Barriers to
entry
Bargaining
power of
suppliers and
customers
Competitions
Other
Challenges

5. MARKET SIZE
• Capacity creation in sectors such as
infrastructure, power, mining, oil & gas,
refinery, steel, automotive, and consumer
durables driving demand in the engineering
sector .
• Rising demand for electrical and
construction equipment
• Nuclear capacity expansion to provide
significant business opportunities to the
electrical machinery industry
• Rapid increase in infrastructure investment
and industrial production to fuel further
growth
• Comparative advantage vis-à-vis peers in
terms of manufacturing costs, market
knowledge, technology and creativity
• Highly organised sector and dominated by
large players employing over four million
skilled and semi-skilled labour
De-licensed engineering sector 100% FDI
permitted .
Cumulative FDI totaled USD 19.9 billion over
April 2000 – 2013 due to policy report.
Advantage India
Engineering
exports from
India:
USD56.7
billion
Engineering
exports
target from
India:
USD125.0
billion
FY 13 FY 15

6. KEY PLAYERS
Company Revenues (FY13) Products
Larsen & Toubro USD28.3 billion
Engineering & Construction, Cement, Electrical &
Electronics
Bharat Heavy
Electricals Ltd
USD9.3 billion
Power Generation, Transmission, Transportation
Siemens India Ltd USD2.6 billion
Power Generation and Distribution Equipment,
Transportation Systems, Communication and Healthcare
Products
ABB Ltd USD1.4 billion** Transformers, Switch Gears, Control Gears
Crompton Greaves
Ltd
USD2.1 billion Power Generation and Transmission Equipment
Engineers India USD0.5 billion
Highways & Bridges, Mass Rapid Transport Systems
Construction, Specialist Materials Manufacturing

7. GROWTH
Growth
drivers
Demand-
side
Drivers
Policy Investment
•De-licensing
•Reduction in tariff and
customs
•Supportive government
policies leading to
higher investments
•Capacity addition for power
generation
•Increase in infrastructure
spending
•Rise in exports
•Increasing FDI inflows
•Higher M&A
•Easy credit facilities for
manufacturing
companies

8. GROWTH
Robust growth in India’s
Engineering exports over the years
FY09 FY10 FY11 FY12 FY13 FY14
31.3
45.3
38.3
58.1
67.1
56.7
CAGR:12.6%
Exports performance of principle
commodities
18%
9%
14%
32%
27%
Column1
Manufactures of
metals
Others
Transport equipment
Machinery and
instrument

9. FUTURE GROWTH
Increasing industrialisation
and economic development to
drive capital goods &
engineering market
Capital goods & engineering
turnover is expected to reach
USD125.4 billion by 2017 from
USD57.6 billion in 2012
Expansion in the electrical
equipment industry
Engineering research &
design segment revenues to
increase fourfold by 2020
Electrical equipment market size
expected to reach to USD105
billion by 2022 from USD24.2
billion in 2011
ER&D revenues projected to
reach to USD45 billion in 2020
from USD11.2 billion in 2012
57.6
125,4
2012 2017
CG and Engineering Turnover
CAGR:16.8%
24.2
105
2012 2022
Electrical equipment market size
CAGR:14.2%
11.2
45
2012 2020
ER&D revenue
CAGR:19.0%

10. FUTURE GROWTH
Indian construction equipment
market to grow sevenfold from
2012 to 2020
Construction equipment market
projected to reach USD22.7
billion by 2020 from USD3 billion
in 2012
Indian telecom equipment
market to more than double
by 2020
Increased production of
Central Public Sector
Enterprise (CPSE)
Telecom equipment market to
reach USD37 billion by 2020
from USD16 billion in 2011
Production of CPSE under DHI to
aggregate USD10.7 billion by
2014 from USD9.2 billion in 2011
3
22.7
Construction equipment market
revenue
2020
CAGR:28.8%
16
37
2020
Telecom equipment market size
CAGR:9.7%
9.2
10.7
2011
2014
Production of CPSE's
CAGR:5.4%
2011
2012

11. CONCLUSION
India's engineering sector is forecast to grow by almost 25 per cent a year for the next
few years because of higher investment in infrastructure, favourable government
policies and new oil and gas power and metallurgy projects.
World class infrastructure is of utmost importance for unleashing high and sustained
growth. In fact, it is the long term driver for the construction sector as well. While short
term factors may keep sentiments subdued, over the long term, demand will remain
strong. The proposed increase in doubling investment in infrastructure from Rs 20
trillion to Rs 41 trillion in the twelfth five-year plan (2012-2017) should translate into a
business for construction companies as and when the black clouds clear-up.