iCEMA
On the back of a slowdown in the construction activity, the Indian CE industry experienced a 23% drop in sales at the end of the third quarter of the current financial year (Q3FY22) compared to Q3FY21. As per ICEMA’s Industry Performance Report, a significant decline has been observed in the growth of earthmoving, material handling, and road construction equipment by 27%, 23% and 38%, respectively, in Q3FY22 vis-a-vis Q3FY21.

Sales of construction equipment (CE) suffered on account of multiple factors: the most noteworthy being the slowdown in road construction, with activity hitting a 4-year low of 21.3km/day over the period April to November 2021, compared to 25.8km/day in the same period last year.

The ban on construction activities by CAQM (Commission for Air Quality Management in National Capital Region) in Delhi NCR and the extended monsoon in some parts of Southern and Eastern regions of the country also adversely impacted the growth, particularly in the third quarter.

icema report


On a quarter-over-quarter basis, CE sales grew by 6% in Q3FY22 vs Q2 FY22. This is much lower than the 47% growth recorded in the previous quarter (Q1FY22), which was very subdued due to the impact of the second wave of Covid-19. The overall sales of the industry in Q3 FY22 stood at 22,630 units, up from 21,323 in the previous quarter (Jul-Sep’21). This growth was mainly led by accelerated sales of concrete equipment (31% growth) and material processing equipment (23%), while earthmoving equipment also showed a positive 4% growth for the third quarter ending December 2021.

The month-on-month sales of construction equipment in both November and December have shown a decline of 18% and 3%, respectively, which contributed to the muted performance of the October-December’21 quarter. The industry had anticipated a lower growth in Q3FY22, based on the continuously declining sales during the year and particularly in the last two months of the 3rd quarter, said Dimitrov Krishnan, President - ICEMA and Managing Director, Volvo CE India, while revealing the figures reported in ICEMA’s quarterly industry report.

Krishnan added that a few other factors have continued to restrict sales growth during the quarter such as the increase in the price of wheeled equipment, triggered by the implementation of CEV IV norms; the impending elections in 5 major states; and the lower state infrastructure spends -all of which also added to the woes of India’s CE industry.

Despite several challenges, the Construction Equipment industry could maintain a positive growth trajectory during the quarter, which proves the resilience of the sector. However, going forward a revival in the construction activity would be critical for maintaining the growth of the industry, said V G Sakthikumar, Convener, ICEMA Industry Analysis and Insights Panel and Managing Director, Schwing Stetter India Pvt. Ltd.

The ICEMA Panel on Data and Analysis provides robust and credible market intelligence by collating, generating, and analyzing the industry data. The value-added quarterly CE industry Report is one amongst the several industry reports collated based on data shared by Members.
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