Construction equipment sector sees muted year after polls hurt Q1 sales
road construction projects and subdued demand due to general elections.
While industry body Indian Construction Equipment Manufacturers’ Association (ICEMA) has yet to release sales data for the quarter ended June 30, the industry estimates about 24,000 units have been sold during the three-month period, similar to the volume reported in the same period last fiscal year.
Senior industry executives estimate sales of construction equipment, widely regarded as a barometer of economic activity, to remain sluggish this year.
While the election impact had hurt first-quarter sales, the rainy season when construction activity dwindles is likely to keep demand subdued in the rest of the first half of the ongoing FY25. The industry though expects the budget to have provisions that would benefit the sector.
The National Highways Authority of India (NHAI) awarded contracts for just 4 km in the first three months of the current fiscal year as against 611 km a year earlier and 969 km during the April-June period of fiscal 2023.
The Ministry of Road Transport and Highways, in November 2023, said that no new liabilities would be created under Bharatmala Pariyojana Phase — 1 until a revised scheme was approved. As a result, the NHAI did not award a single mega highway project in the first three months of this fiscal year.
Sales of construction equipment in the local market rose 24% to 123,671 units in FY24. The growth was 29% in the fiscal year before that.
“The coming three months too will be challenging. Industry volumes
