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Electrical equipment Industry retains "sparkle" (Q1 HY 2010-11)
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Indian Electrical Equipment Industry has retained its sparkle & maintained growth momentum in the first quarter of the year 2010-2011 said P.V. Krishna, Director General, IEEMA. The Indian Electrical equipment industry has shown impressive growth of 17.42% during the 1st Quarter of 2010-2011. In the first quarter of 2009-10 the growth registered was just 1.24 %.Indian Power T & D Equipment is equipped to take on the challenges to achieve the targets in the remaining 2 years of the 11th plan. IEEMA Members have ramped up their production capacities and are fully equipped to provide quality products at competitive prices, said P.V. Krishna.

Substantial improvement in demand led growth experienced in the 2nd half of 2009-10 resulted in a sharp rise in the performance. During this period, the industry grew by about 20%. The fourth quarter of 2009-2010 also saw a satisfactory growth of 30% and above in segments like rotating machines, switchgear and cables due to economic recovery in sectors like real estate and infrastructure and in industrial expansion.

IEEMA, the apex body representing the Indian Electrical Equipment industry, which monitors production and sales data of its members on a regular basis, informed that the growth figures reported were in terms of volume and thus represented real increase in output.

SWITCHGEAR INDUSTRY LEADS THE WAY:

The highest growth of 38 % was registered by the switchgear segment in first quarter of 2010-2011, consisting of MV and HV breakers, where growth has increase sharply as compare to previous year’s first quarter. EHV breakers continue to be in high demand for various power sub-stations and transmission projects. Further, LV Switchgear segment having products such as Contactors, MCBs and MCCBs etc. has seen remarkable growth revival of more than 35 % in this quarter due to renewed momentum in reality and industrial sector.

Recovering dramatically to register more than 30% growth in last quarter of 2009-10, Rotating Machine Industry segment has shown 22% growth in this first quarter compared to 2009-2010 Q1. Segments like LT Motors and AC Generators have also shown significant growth during this quarter indicating momentum in the core sector & to sustain un-interrupted power supply to all segments respectively.

From previous year’s moderate growth in Q1, Cable sector has shown 15 % growth in the first quarter of 2010-11 mainly due to increase in demand from industrial projects. The building wire segment is also seeing overall improvement in demand from the construction sector.

Transformer sector grew by overall 15% as compared to negative (-) 3.25% in the first quarter of the year 2009-2010. Distribution Transformers have seen some good release of orders in this quarter. Power Transformers continue to grow by 9 %. Order book position for Transformers is satisfactory.

During 2009-2010, sales of energy meters went up by 11%. However, in the first quarter of 2010-2011, Energy Meters industry has grown by 20 %, largely due to increase in demand of Single phase static meters from some of the public and private distribution companies. However, there is a sharp decline in sales of Poly phase meters.

Capacitor industry grew by more than 12 % largely because of demand from the on-going RGGVY schemes.

Transmission Lines sector comprising of transmission lines towers and conductors has registered a steady growth of 9% during the year 2009-2010. However, in first quarter of 2010-2011 the sector has grown overall by 6.25 % in comparison to 2009-2010 Q1 growth of 18.45 %. Transmission line towers have grown by 12% led by domestic order growth by more than 40 %. Conductor segment is showing continues declining trend in growth from last three quarters due to delay in finalizing the orders. Overall transmission line sector is hopeful to post positive growth in medium term as many orders for T& D projects are getting awarded mainly by PGCIL to close to the 11Th plan targets for transmission & substations.

In summary, Power equipment industry is confident about sustainability of this growth. However, the conventional business model of utility driven order finalization has changed to a certain extent with increasing projects driven through EPC process this would throw new challenges to the manufacturers with pricing and delivery being key drivers.

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