Booming construction industry to boost growth in Indian construction chemicals markets

November 14th, 2007 - 8:07 am ICT by admin  
Surging construction activity and 100 per cent FDI in real estate are giving a fillip to the construction chemicals markets in India, which grew by an estimated 24.1 per cent in 2006. Any company that realises the importance and potential of this nascent market - projected to grow at a compound annual growth rate (CAGR) of 21.9 per cent from 2007 to 2013 - can capitalise on considerable growth opportunities.

New analysis from Frost and Sullivan (, Indian Construction Chemicals Markets, finds that the market revenue was estimated to be Rs 10 billion in 2006 and is likely to reach Rs 40 billion by 2013.

“The Indian Government’s approval for allowing 100 percent FDI in the real estate sector has given a major boost to the already fast growing construction industry,” notes Frost and Sullivan Industry Analyst Dominic Britto. “Construction chemicals accounts for only 2 percent of overall construction costs, but the benefits are in multiples; rising awareness about such advantages coupled with the growth in the construction industry is set to drive the Indian market for construction chemicals.”

The construction industry is the key end user of construction chemicals that includes construction of infrastructure, industries, as well as commercial and residential buildings. Construction chemicals are also used for repair and maintenance of these structures and comprise around 11 per cent of the total demand. Rising awareness, changing lifestyles and, most importantly, the increasing spending power of end users will be the key drivers in the sustained expansion of the Indian construction chemicals market.

At present, the absence of quality standards for the manufacture as well as application of construction chemicals is a major challenge. This has the potential of leading to price wars at the cost of quality, thereby eroding margins to such an extent that new companies might be reluctant to enter this market. This is further likely to lead to highly unsatisfied end users getting substandard products and services and will have a major impact on the industry as a whole.

“To succeed in a situation where established quality standards are lacking, companies need to develop their own standards and build powerful brands that will not only promote awareness about the benefits of construction chemicals, but also set standards for the industry to follow,” advises Britto. “These companies can also take advantage of being first movers in the market.”

Indian Construction Chemicals Market is part of the Chemicals and Materials Growth Partnership Service programme. All research included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants. (ANI)

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