Getting its chemistry with the construction industry right is pivotal for the success of the construction chemicals sector.
The construction chemical sector is a sunrise industry. Growing at a CAGR of 17 per cent, it is projected to double in the five years ending in 2018, to Rs 7,650 crore.
¨Demand for faster and more durable construction is a key catalyst for construction chemicals today,¨ says Giles Everitt, Managing Director, Chryso India. ¨The need for faster construction, sustainability and use of variety of binders or raw materials is spurring the construction chemicals industry,¨ says Nilotpol Kar, Business Director, Construction Chemicals, South Asia, BASF. And Charu Smita, Assistant Director, Chemicals and Petrochemicals, FICCI, opines, ¨Overall economic growth, increased government investments in infrastructure and real estate, and the participation of overseas investors and contracting companies in the Indian construction company are helping to drive demand for construction chemicals.¨ However, the driver the industry is most keenly watching is the growing consciousness about the benefits of spending an additional 2-5 per cent of the project cost in construction chemicals. Such awareness will be the real game-changer.
Cost benefit experiences
Real estate and infrastructure developers using construction chemicals avidly assert their effectiveness. Industry players want such awareness to percolate.
¨We use over 50 types of construction chemicals for better construction outcomes and to save on energy,¨ says Getamber Anand, Chairman & Managing Director, ATS Group. ¨Broadly, chemical coatings help cut energy costs by 5-10 per cent and prolong the life of a building by a decade.¨
¨Construction chemicals come in liquid or powder form and are mixed in the ratio of 50 or 100 or 200 gm in cement bags of 50 kg or 100 kg to improve the overall strength of beams, columns and lintels, concrete, precast and plaster structures, for an overall cost of about 2 per cent of the project cost,¨ says Suresh Gogia, Managing Director, Ascent Group. ¨But their payoffs are huge in terms of saving on the cost of plaster rebounding, restricting cracks owing to temperature variations, eliminating water permeability and increasing the overall life of the building. I estimate this additional investment can cut maintenance costs by 40 per cent. Chemicals for plaster reinforcement also improve surface finishes.¨
In the long run, construction chemicals may help increase the overall standards of the built environment to the benefit of users. ¨Chemicals allow governments to legislate standards of longevity, safety and performance,¨ says Anand.
Admixtures currently enjoy the biggest share of the market. However, waterproofing is the fastest growing segment, expanding at 22 per cent per annum.
Whether it is admixtures, repair and rehabilitation products, waterproofing products, flooring products or other miscellaneous chemicals, both Indian and overseas technologies are available.
Leading players are introducing India to overseas labels. Thermax´s Chemical Division entered the construction chemicals space in 2013 in collaboration with leading European construction chemical company Tecnochem Italiana SpA to offer the entire spectrum of construction chemicals from admixtures to cement grinding aids. And Chowgule ABP Coatings (India) Pvt Ltd brings to the Indian market a wide range of epoxy and polyurethane-based floor coatings, backed by its German JV partner AB Polymerchemie Gmbh. ¨Our aim is to make available high quality and easy-to-use products at competitive prices,¨ says Ewart Lazarus, Managing Director, Chowgule ABP Coatings (India) Pvt Ltd.
Tailored for India
Some overseas players are tailoring their overseas range for Indian conditions. French construction chemical company Chryso offers the Indian cement industry, construction systems and concrete admixture markets a diverse product portfolio based on its overseas range but supported by its R&D centre in Navi Mumbai. ¨We understand the challenges and intricacy of raw materials and climate faced in India,¨ says Everitt. ¨We are proud that 35 per cent of our turnover is from products less than five years old, a true sign of how effective our R&D is.¨
For BASF, making inroads in the Indian construction chemicals segment is not only about catering to the unique needs of the Indian construction industry but the unique needs of each site. ¨We offer India products adhering to international standards like MasterSeal Roof for waterproofing, MasterSeal Traffic for deck coatings, MasterEmaco for repairs and Ucrete for flooring,¨ says Kar. ¨On a client-to-client basis, we understand that concrete admixtures typically need to be adjusted to the individual conditions of each construction site. One site may have crushed sand while another would have natural sand. Accordingly, the admixture offerings and their composition changes from site to site. We are tailoring products to the site and test conditions.¨
Waterproofing chemicals currently account for 14 per cent of demand but are expected to expand their share to 22-24 per cent of the market.
¨The waterproofing segment is performing the best on the back of rising awareness about the role of such chemicals in assuring the long-term durability of structures,¨ says BS Nagaraj, Product Segment Manager, Fosroc.
What is especially helping to grow the waterproofing segment is the increasing variety of solutions.
¨Traditionally, sheet membranes based on modified bitumen dominated the waterproofing market in India,¨ says Deepak Kanitkar, General Manager-Technology and Business Development, Chembond Chemicals Ltd. ¨Now, the focus is shifting to liquid applied systems, which can be more easily and speedily applied, have better adhesion and can be effectively applied on both the positive and negative side of structures. Also, better sheet membranes based on PVC, EPDM, HDPE and TPO are being used.¨
¨In liquid systems, tar or asphalt-modified single-component PU systems, brush-applied 2K cementitious products and crystalline systems are common,¨ says Kanitkar. ¨Recently 2K PU and polyurea or polyaspartic-based systems have been proving more effective because they perform better and offer application advantages.¨ Key challenges with liquid systems are controlling and measuring the application thickness and, in case of two-pack systems, ensuring proper mixing. Also, systems like polyurea require properly trained applicators.
A positive of polyurea technology is its environment-friendly tag. ¨We introduced polyurea technology in India; these are green-labelled products demanded by green buildings,¨ says Nagaraj. ¨The green construction project trend will continue to spur growth in this segment.¨
Fosroc´s green range includes Polyurea WPE, a waterproofing solution for landscaping. Pre-applied fully bonded membrane technology like the Proofex Engage system provides a solution for basement waterproofing. Also, TPO membranes like Proofex ORG, OGP and OFB work well for the waterproofing of exposed roofs.
Opportunities are also rife in the industrial flooring market, with the fast development of new railway infrastructure, airport terminals, schools and hospitals. ¨At present, the industrial flooring market comprises only 2 per cent of the total construction industry turnover,¨ says Lazarus. ¨Products for new floorings contribute about 80 per cent of this market while the remaining 20 per cent emerges from the maintenance market.¨ An effective combination of intermediate coat and top coat can protect a good-quality concrete base from stress from mechanical loading, abrasion, chemical attacks and thermal changes. Chowgule has been focusing on specialised epoxy and polyurethane floorings that can protect base floorings from stress, withstand heavy traffic, ease maintenance, and address aesthetic and antistatic requirements. It also offers unique solutions such as the grease removal system to remove embedded oil and grease from contaminated concrete floor substrates.
Crack injection has emerged as an industry within the construction chemicals industry for becoming a part of both repair and waterproofing procedures. ¨Dry cracks in new structures are treated based on their nature with cement, epoxy or PU resin-based systems,¨ says Kanitkar. ¨Treating wet or leaking cracks involves mainly use of PU-based systems or moisture or water-insensitive, epoxy resin-based injection grouts.¨
¨Polyurethane-based systems are gaining ground because they can accommodate crack movement owing to settlement or thermal gradient,¨ according to Kanitkar. ¨Also, PU-based, two or three-component systems that generate foam in a matter of seconds when they come in contact with water are very effective at stopping water leakages even when the water pressure is high. Owing to the generation of foam, less quantity is used, thereby reducing the actual cost significantly.¨
One of the biggest challenges facing construction chemicals players is the paucity of applicators.
¨A lack of skilled manpower is a major constraint,¨ agrees Everitt. Gogia echoes the sentiment, saying, ¨A major challenge is getting trained applicators who understand the dos and don´ts of construction chemicals. Chemicals should be used as per the manufacturer´s specifications for the best outcomes-any mismatch may affect their overall strength-and to ensure no harm to the applicator.¨
To tide over this issue, Thermax Channel Associates and Applicators is a single-point source for all construction chemical solutions, including technical and after-sales support. Chowgule retains a professionally trained contracting team supported by a network of trained applicators to deliver product installations to the fullest satisfaction of customers. Chryso India is very much aligned to direct interaction with customers.
¨Through these interactions, we ensure we are providing the correct solution and the customer understands correct application, for instance a high-strength mortar has to be correctly specified; it then needs to be prepared and applied correctly to fulfil its purpose without risk of failure and detriment to the structure,¨ explains Everitt. And BASF believes in bringing innovative solutions and is continuously working to percolate technology to the bottom of the pyramid to help consumers use the latest technologies.
Green chemistry is spurring the evolution of chemicals that play a role in green construction. For instance, phase change materials can usher in savings on energy consumed for heating and cooling processes in structures in tropical regions, by allowing the walls and ceilings of such structures to absorb and store excess heat during the day and dissipate it at night. In hotter areas, high reflectance and durable outdoor coatings can be applied to roofs and walls to reflect sunlight radiation and reduce roof and wall temperatures, leading to energy savings on cooling.
¨Eco-friendly anti-carbonation coatings can reduce indoor temperatures by 8-20 per cent and thereby improve the energy efficiency of the built environment,¨ says Smita. ¨By forming a flexible film that allows the surface to breathe and acts as a barrier for carbon dioxide and other gases, they also protect structures, especially coastal, against aggressive weather conditions.¨
Striking the right chemistry with customers will help usher in the next wave of growth in the sector.
Most of the chemicals industry is focused on B2B selling today. ¨We offer our customers differing load quantities and pack sizes depending on their requirements, but today our business is not aligned to the retail segment,¨ says Everitt.
¨The majority of our products can only be sold in a B2B model because they require professional applicators,¨ says Kar. ¨What helps the large number of customers requiring smaller quantities is that we are using the indirect distribution channel in addition to the direct sales channel. Pack sizes are typically smaller in the distribution channel than in the direct sales channel.¨ The B2C segment is expected to increase its share in the coming years and help address other needs. ¨High customer price-sensitivity plagues the industry,¨ says Smita. For his part, Anand says, ¨Challenges concerning construction chemicals mostly relate to their quality, adaptability to local soil and procurement-related issues like local availability and at short notice.¨ Retail expansion would help penetrate small markets and further enhance awareness. And the availability of smaller ´right-sized´ packs might also help mitigate the price-related concerns of consumers going forward.