The foundry market in India will grow by $13.08 bn during 2020-2024, according to Technavio...
The foundry market size in india has the potential to grow by USD 13.08 billion during 2020-2024, progressing at a CAGR of over 10% during the forecast period.
Technavio’s latest report provides a detailed analysis of the market by end-user (automotive, electrical and construction, industrial machinery, agriculture, and others) and casting type (gray iron casting, non-ferrous casting, ductile iron casting, steel casting, and malleable casting).
This market is fragmented, and the degree of fragmentation will accelerate during the forecast period. Ashok Leyland, DCM, Electrosteel Castings, Jayaswal Neco Industries, Kirloskar Ferrous Industries, Mahindra CIE Automotive, Nelcast, Sanmar Group, Tata Metaliks and Tata Motors are some of the major market participants. To make the most of the opportunities, market vendors should focus more on the growth prospects in the fast-growing segments, while maintaining their positions in the slow-growing segments.
Market Competitive Analysis
The market is characterized by the presence of well-diversified local vendors, mainly in five industrial clusters, namely Belgaum, Batala and Jalandhar, Coimbatore, Kolhapur, and Rajkot. Mahindra CIE Automotive Ltd., Nelcast Ltd., Sanmar Group, Tata Metaliks Ltd., and Tata Motors Ltd. are some of the major market participants. The prominent players are investing in R&D and focusing on strategies to carry out further research to develop better products.
Although the focus on technology upgrades will offer immense growth opportunities, environmental issues leading to increasing ecological costs will challenge the growth of the market participants. Technavio suggested that focus on technology upgrades has been instrumental in driving the growth of the market.
Foundry Market in India: Segmentation and Key Drivers
India is one of the leading countries in the global foundry market. This is primarily because of the growing demand for metal casting from the automotive sector. The Indian auto components industry has experienced steady growth since 2010 and will continue to grow during the forecast period. The need for lightweight automobiles has increased the use of non-ferrous metals in their production, contributing to the foundry market growth in India. The growth of the foundry market share in India by the automotive segment will be faster than the growth of the market by the other segments.
To cater to the increasing demand for metal castings in India, foundries are investing in new technologies and equipment. For instance, Hinduja Foundries is investing in energy-efficient technologies and equipment such as real-time power optimizers and installation of an energy management system in induction furnaces to reduce energy consumption. The company is also investing in R&D of compacted graphite iron for cylinder blocks and heads. Indian foundries will benefit from technology upgrades in several ways, such as low power consumption, increased production efficiency, higher capacity use, and high-profit margin. As a result, the foundry market in India is expected to register a CAGR of over 10% during the forecast period.
To support the manufacturing sector, the Indian foundry industry is estimated to garner around USD 3 billion of investment by 2025 to cater to the potential demand for castings of 30 million metric tons within the country.
The automobile sector is responsible for generating 60% demand for casting production in the country, which is one of the vital foundry market trends in India.
All medium and large-scale foundries are planning to have sand reclamation plants for reuse of sand to reduce energy consumption during the manufacturing process across industries.
The factors mentioned above will drive investments by Indian foundries to ramp up their production capacity to meet the demand for metal casting in the country during the forecast period.
The foundry market in India is expected to record a CAGR of over 10% during the forecast period.