Indian Construction Equipment Industry Registers 28% Q-o-Q Growth in Q3 FY25

The performance of the Construction Equipment (CE) industry was significantly better in the third quarter of the current fiscal (Q3 FY25) compared to the second quarter, with sales increasing steeply by 28%, reaching 39,382 units from October to December 2024. On a year-on-year basis, Q3 FY25 sales were up by 8% compared to Q3 FY24.

Several factors contributed to the industry's growth, including the government’s continued focus on infrastructure development, the end of the monsoon season, pre-buying ahead of the implementation of the CEV V emission standards in January 2025, and the introduction of various new and sustainable construction equipment variants, which attracted consumers seeking more efficient and environmentally friendly machinery.

“The results for the third quarter of FY25 reflect the continued progress of infrastructure development, leading to sustained demand for construction equipment. With the continued focus on infrastructure spending in the recent budget, there is strong optimism for demand to further strengthen in the coming quarters,” said Mr. V. Vivekanand, President of ICEMA and Managing Director of Caterpillar India Pvt. Ltd.

“As the Indian CE industry progresses towards the targets of the CE Vision Plan 2035 and aligns with the Viksit Bharat@2047 objectives of the Government, the industry is exploring new technologies and developing a range of efficient and sustainable products that are further driving demand for construction equipment in the country,” he added.

Of the total Q3 FY25 sales, 35,835 units were sold in the domestic market, while 3,547 units were exported. Apart from a 9% decline in Material Processing Equipment sales, all other major equipment segments registered robust Q-o-Q growth. The industry sold 28,223 units of Earthmoving Equipment—29% more than in Q2 FY25. Material Handling Equipment sales stood at 4,790 units, registering a 29% increase. Concrete Equipment sales rose by 21% to 3,674 units. Road Construction Equipment recorded the highest surge, with sales jumping 56% to 2,094 units. The sharp increase in the Road Construction Equipment segment aligns with the Ministry of Road Transport and Highways’ (MoRTH) commitment to accelerating project awards in the second half of the fiscal year.

Overall, sales of construction equipment in the first nine months of the current financial year have increased by 5% Y-o-Y, which is remarkable for an election year. In December 2024 alone, total CE sales stood at 12,793 units, a 4% increase over November 2024 sales.

Mr. Jaideep Shekhar, Convener of the ICEMA Industry Analysis & Insights Panel and Vice President & Managing Director of Terex India Pvt. Ltd., said, “The results for Q3 of the current fiscal are very encouraging, with positive growth even on a year-on-year basis, especially since we usually experience overall negative growth in election years. Besides the increase in construction activity due to ongoing and new infrastructure projects, demand for construction equipment also rose as customers made advance purchases to avoid anticipated price hikes following the implementation of CEV V emission standards in January 2025. Given the accelerated growth in the third quarter and the overall 5% growth during April to December 2024, the industry expects to conclude the current year with nearly 5%–8% growth.”

Mr. Vivekanand also expressed confidence in the industry’s bright future as it embraces higher levels of localization, innovation, technology, and sustainability. He called for better-targeted policies to create an enabling environment for MSMEs, foster technology adoption, and enhance collaboration among stakeholders, allowing the Indian CE industry to emerge as a major exporter and a global manufacturing hub for construction equipment.

The ICEMA Panel on Industry Analysis and Insights provides robust and credible market intelligence by collating, generating, and analyzing industry data. The value-added quarterly CE Industry Report is among several industry reports compiled based on data shared by its member companies, which represent about 95% of the OEMs operating in the Indian Construction Equipment industry.

ICEMA (Indian Construction Equipment Manufacturers Association) is the nodal body representing the Construction Equipment industry (OEMs, suppliers, and FIs) in the country and is affiliated with the Confederation of Indian Industry (CII).