ICRA predicts construction equipment volume growth in CY2021

26 Nov 2020 CW Staff

The key MCE demand drivers in the current market are Central Government projects, particularly roads and rural demand. Healthy awards and execution rates of road projects by the NHAI has boosted volumes of backhoes and excavators, more recently. Pick-up in regular funds flow from the Central Government continues to support volumes. However, new state projects have not taken off as most states are struggling with fiscal bandwidth. On the other hand, healthy volumes in the agri-segment besides heightened activity under the PMAY and the PMGSY are the primary cause for rural demand.

Despite the volume uptick since late June-July 2020, ICRA has maintained a negative outlook on the sector as demand sustainability is uncertain. A prolonged economic slowdown triggered by the pandemic, the government’s limited fiscal bandwidth for investments and the risk of Covid resurgence leading to further lockdown and construction disruptions are not ruled out.

Source: Equipment India

The domestic mining and construction equipment (MCE) industry is expected to post a volume growth of more than 20 per cent in the calendar year 2021, according to the finding of the ratings agency ICRA. According to the agency, the MCE industry has staged a smart recovery since late June 2020, posting a year-on-year (YoY) growth of 20-22 per cent in Q3 CY2020. Though the growth is still lower by 14 per cent compared to Q3 CY2018 levels, it is significant considering the deep demand contraction of ~40 per cent in H1 CY2020. As per ICRA’s update, demand for the all-purpose backhoes recovered much faster than demand for other equipment like excavators. Supporting factors like strong project awards in the road sector, timely release of payments to contractors for all Central Government projects and a few state projects (in North India); and a strong rural demand (for agriculture and housing) aided the recovery. The ratings agency in May 2020 had estimated a sharp 15-20 per cent decline in industry volumes during CY2020 but considering the demand revival since July 2020 and the continued market momentum in November 2020, substantiated by dealer check-ins, the decline now is estimated (revised) to be lower at 12-14 per cent.The key MCE demand drivers in the current market are Central Government projects, particularly roads and rural demand. Healthy awards and execution rates of road projects by the NHAI has boosted volumes of backhoes and excavators, more recently. Pick-up in regular funds flow from the Central Government continues to support volumes. However, new state projects have not taken off as most states are struggling with fiscal bandwidth. On the other hand, healthy volumes in the agri-segment besides heightened activity under the PMAY and the PMGSY are the primary cause for rural demand.Despite the volume uptick since late June-July 2020, ICRA has maintained a negative outlook on the sector as demand sustainability is uncertain. A prolonged economic slowdown triggered by the pandemic, the government’s limited fiscal bandwidth for investments and the risk of Covid resurgence leading to further lockdown and construction disruptions are not ruled out.Source: Equipment India

Infrastructure Transport

12 Mar 2026

Kavach 4.0 Commissioned on Delhi–Mumbai and Delhi–Howrah

"Kavach version four has been commissioned on 1,452 route km, covering the high density Delhi–Mumbai and Delhi–Howrah corridors. The rollout included laying 8,570 km of optical fibre, installation of 1,100 telecom towers, deployment of trackside equipment over 6,776 RKm and establishment of 767 station data centres. Trackside implementation has been taken up on 24,427 RKm covering Golden Quadrilateral, Golden Diagonal and High Density Network sections. The programme aims to strengthen signalling and train protection on key routes.Kavach is an indigenously developed automatic train protecti..

Infrastructure Transport

12 Mar 2026

Railways Advance Kalyan–Murbad Line And Mumbai Capacity Expansion

"Indian Railways is advancing multiple rail infrastructure projects in Maharashtra, including the sanctioned Kalyan–Murbad new line and sizable investments under the Mumbai Urban Transport Project and the Mumbai–Ahmedabad High Speed Rail project. The Kalyan–Murbad 28 km new line has been sanctioned at Rs 8.36 billion (bn) on a 50:50 cost-sharing basis with the Government of Maharashtra and has been declared a Special Railway Project for land acquisition; proposals covering 214 hectares are at various stages of acquisition. Budgetary outlay for projects falling fully or partly in Maharash..

Infrastructure Urban

12 Mar 2026

Parliamentary Panel Flags Funding Gaps in Heavy Industries

"The Department-Related Parliamentary Standing Committee on Industry (Rajya Sabha) presented its 332nd report on the Demands for Grants 2026-27 of the Ministry of Heavy Industries (MHI). Figures converted from crore and lakh are expressed in million (mn). The Budget Estimates 2026-27 for the Ministry stand at Rs 79,399 mn against a projected requirement of Rs 94,843.2 mn, a shortfall of about 16 per cent, with revenue at Rs 79,370.8 mn and capital compressed to Rs 28.2 mn from Rs 5,020 mn.The committee flagged recurring BE-to-RE compression and declining revised estimate utilisation, and calle..