Election Impact: Mining Equipment Sales to Decline
Equipment

Election Impact: Mining Equipment Sales to Decline

"The sales volumes of the domestic mining and construction equipment (MCE) industry are projected to experience a downturn in FY2025, following two consecutive years of robust growth. According to ICRA, after achieving a remarkable 26 percent growth in FY23 and 24 percent in FY2024, a decline of 12 to 15 percent in sales is anticipated for FY25, translating into volumes of 1.14-1.18 lakh units.

The anticipated reversal in this growth trajectory is primarily attributed to a slowdown in new project award activity during Q4 FY2024 and Q1 FY2025. The Model Code of Conduct, enforced during the Parliamentary Elections scheduled for April-May 2024, is expected to hamper project awarding activity, impacting the MCE industry.

The disruption in project awarding activity over the past two quarters has been noted. Ritu Goswami, Sector Head of corporate Ratings at ICRA, stated, ?Pre-election acceleration in project execution by the Government generated significant demand momentum for the MCE industry in the past two years. However, with the likely disruption in project award activity for two consecutive quarters during Q4 FY2024 and Q1 FY2025 amidst the Parliamentary Elections, and the monsoon-related effects on construction activities in Q2, the first half of FY2025 is anticipated to witness a moderation in sales.?

Despite the near-term challenges in the domestic MCE demand environment, the industry's long-term prospects remain promising. This is attributed to the sustained government focus on infrastructure development. Furthermore, a rebound in volumes is anticipated in H2, driven by a resurgence in new project awards starting Q3 and partially supported by pre-buying due to the CEV-V emission norm transition scheduled for January 2025."

The sales volumes of the domestic mining and construction equipment (MCE) industry are projected to experience a downturn in FY2025, following two consecutive years of robust growth. According to ICRA, after achieving a remarkable 26 percent growth in FY23 and 24 percent in FY2024, a decline of 12 to 15 percent in sales is anticipated for FY25, translating into volumes of 1.14-1.18 lakh units. The anticipated reversal in this growth trajectory is primarily attributed to a slowdown in new project award activity during Q4 FY2024 and Q1 FY2025. The Model Code of Conduct, enforced during the Parliamentary Elections scheduled for April-May 2024, is expected to hamper project awarding activity, impacting the MCE industry. The disruption in project awarding activity over the past two quarters has been noted. Ritu Goswami, Sector Head of corporate Ratings at ICRA, stated, ?Pre-election acceleration in project execution by the Government generated significant demand momentum for the MCE industry in the past two years. However, with the likely disruption in project award activity for two consecutive quarters during Q4 FY2024 and Q1 FY2025 amidst the Parliamentary Elections, and the monsoon-related effects on construction activities in Q2, the first half of FY2025 is anticipated to witness a moderation in sales.? Despite the near-term challenges in the domestic MCE demand environment, the industry's long-term prospects remain promising. This is attributed to the sustained government focus on infrastructure development. Furthermore, a rebound in volumes is anticipated in H2, driven by a resurgence in new project awards starting Q3 and partially supported by pre-buying due to the CEV-V emission norm transition scheduled for January 2025.

Related Stories

Gold Stories

Next Story
Resources

Schindler named among Forbes’ World’s Best Employers 2026

Schindler has been named among Forbes’ World’s Best Employers 2026, a global ranking recognising companies for their workplace environments.Compiled by Forbes in partnership with Statista, the ranking is based on independent employee feedback, including whether employees would recommend their organisation to friends and family.The company said the recognition reflected its focus on creating a workplace where employees can develop their expertise and build careers. ..

Next Story
Infrastructure Urban

India needs an export-execution mindset: Vishesh Jain

Interview with Vishesh Jain, Founder & CEO, EximpleWhat gaps in India’s global trade ecosystem led you to build Eximple, and what problem did you see businesses struggling with most?Eximple came out of a problem that all three founders had seen from different choke points in the trade ecosystem. India has millions of MSMEs and manufacturers, and many of them can make products that are genuinely competitive on quality. Yet only a small fraction is able to build meaningful international businesses. In our experience, the gap is usually not manufacturing capability; it is the ability to exe..

Next Story
Building Material

Nuvoco reports 13.5% revenue growth in Q2 FY27

Nuvoco Vistas Corp. Ltd. reported consolidated revenue of Rs 27.9 billion for Q2 FY27, up 13.5% year on year. Cement sales volume rose 9% to 4.7 million tonnes (MMT), while EBITDA increased 11% to Rs 4.11 billion.The company said it began its cement operations in 2014 with a 2.3 MMT per annum (MMTPA) operation at Nimbol. It now aims to reach 35 MMTPA of cement capacity by FY28, nearly 15 times its initial capacity. Its portfolio spans cement, ready-mix concrete and modern building materials.On sustainability and cost efficiency, Nuvoco partnered with CleanMax for a 46.4 MW wind-solar hybrid re..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code