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Challenges and Opportunities in Construction Chemicals

This was presented at World Infrastructure Congress and Awards 2019 in Mumbai. The brief presentation gives an overview of the current challenges and future opportunities. For any further consultation related to Indian market strategy, the author may be contacted at 9987673063 or arijitb962@gmail.com.

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Challenges and Opportunities in Construction Chemicals

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  1. CHALLENGES AND OPPORTUNITIES IN CONSTRUCTION CHEMICALS ArijitBasu Independent Advisor (arijitb962@gmail.com)

  2. INDIA PERSPECTIVE • The current market size is estimated to be INR.8500-9500 Cr approximately, poised to grow at 14-15% CAGR for next 5 years • “Sunrise Industry” as described by FICCI • Major growth drivers are – Urbanization, Green Buildings, Investments in Infrastructure, Aspiring middle class, Growing awareness and More adoption of ready mix concrete

  3. INDIA PERSPECTIVE Indian construction chemicals market Segment  • Concrete Admixtures (40%) • Flooring (12%) • Water Proofing (14%) • Repair, Rehabilitation & Strengthening (12%) • Grouts, Mortar, Ready made plasters and Tile Adhesives (10%) • Protective Coatings (8%) • Sealants (4%) Industry sectors covered • Infrastructure Sector • Industrial Sector • Residential and Commercial Real Estate Sector New Build : Refurbishment – 60:40

  4. VALUE ADDITON THROUGH CC • Durability enhancement • Long term protection • Sustainability Improvement • Time and cost savings • Risk mitigation • Special requirements (aesthetics, energy efficiency, ultra high strength etc.) Construction Chemicals are the medicines for structures!

  5. 80% Life Cycle Management… or the trap of low initial investment versus risks…. Investment for construction chemicalssystem versus total investment in civil works • Water ingress, structural deterioration etccausing 80% of damages resulting in huge maintenance and repair costs 1-2 % 20 % 98 – 99 % A reliable construction chemicalsystem solutionsubstantially reduces the Total Costs of Ownership (TCO) over the entire service life of a concrete structure

  6. VALUE CHAIN Key stake holders; • Clients • Consultants/ Architects • Contractors • Specialised Contractors/Applicators • Distributors/Retailers • Manufacturers

  7. CHALLENGES • Price sensitivity • Low entry barrier • Lack of skilled manpower • Low awareness level • Lack of stringent regulations • Higher input cost and availability of Raw materials

  8. CHANGING REGULATORY ENVIRONMENT: • Current and prospective regulatory guidelines incentivizing energy-efficient and green buildings are expected to drive demand for suitable, innovative and safe chemicals. • Compulsory usage of Ready Mix Concrete in Metros like Mumbai, Bangalore etc. is a key regulatory change. Similar regulations in Tier-I & other cities would be a key driver in increasing the usage of construction chemicals. • With increased government focus on investments in infrastructure, increase in usage of RMC in Govt. infrastructure projects would boost the growth further • Still a lot needs to be done in terms of compulsory usage of construction chemicals specially in real estate sector • CCMA (Construction Chemical Manufacturers Association) India, is an organized body working to promote the use of Construction Chemicals in India“, conducting technical seminars and awareness programs for the benefit of construction industry.

  9. FURTHER OPPORTUNITIES • Increase in awareness about quality construction materials such as performance enhancing products among consumers and builders. • Increased construction activities triggered by urbanization and development of rural areas which are still largely untapped markets. ~30% of Indian population is urban and Urbanization to grow to 40% by 2030 • The use and access to foreign technology and the entry of foreign companies in the construction chemicals sector has eventually resulted in quicker growth of the construction chemical sector. Today several projects funded by multilateral agencies like ADB and World Bank have made use of good quality construction chemicals mandatory

  10. POSITIVE INFLUENCE OF INDIAN MANUFACTURERS • Along with the MNCs locally manufacturing, the Indian companies are positively impacting through - contract manufacturing - license manufacturing - comprehensive performance including application - service and logistics innovation - large Indian groups, adding value through CC - consistent quality at smart pricing, encouraging healthy competition

  11. CONCLUSIONS • Construction Chemical Industry is going to be an action packed, vibrant and growing industry (Sunrise Industry) with a 15% CAGR • There will be opportunity for all stake holders • The penetration and awareness will grow further with implementation of stringent regulations • Indian manufacturers will play a key role in shaping up the industry and will lead the way!

  12. Hope the mood is not like this… THANK YOU FOR YOUR ATTENTION

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