Market Study and Potential for EOT Cranes,

Market Study and Potential for EOT Cranes, Gantry Cranes, Jib, and the Market for Imported European Hoist and Crane Components in India.

A boom in the construction industry caused a corresponding boom in the demand for construction building equipment (specifically in cranes and hoists), which shows prediction of increasing in the future. Cement, steel, and construction industries have all been involved in this popularity, all of them requesting EOT cranes, Gentry cranes, JIB cranes and European-imported hoist and crane components. The market for machinery is huge, particularly for used machinery coming from Europe with the latter mostly being used in the unorganized sector. Off Highway Research (OHR), reported that in 2009, India sold 6,499 mobile cranes, most of which have been the pick and carry type. As of 2011, the market size for EOT cranes and hoists is approximately Rs 1,500 crore to 1,700 crore (Project Monitor). By the year 2010, alone the value number of cranes in total was estimated to exceed Rs5,43,500 core. Some skepticism is current regarding the European second-hand machines. However, it is predicted that with growing realization of the cost-effectiveness of these machines and with growing pressure of demand that will push up prices, the market for these second hand machines may yet flourish.

The crane market is also divided according to tonnage with it falling here into three categories: light, medium, and heavy capacity. With the project sizes in core and industrial construction expanding, machines at the far end of the heavy capacity are most in demand (Basistha, 2008).

India's EOT crane market has risen dramatically since the beginning of the new millennium with sales exceeding 34% per year, and this growth is predicted to continue. The average EOT crane life in India is 25 years. The average life of the other cranes approximately the same, or shorter. As the government continues with is building projects, demand seems to be exceeding supply, and so the market for all cranes in India - EOT Cranes, Gantry Cranes, Jib, and Imported European Hoist & Crane Components -is large and poised for growth.

Sector and Region-Wise Requirement.

India is split up into tier I and tier II cities and in both regions cranes are constantly being used and in demand. In both tiers, crushing and screening equipment are in demand, whilst popularity for technology that is mobile rather than stationary is growing.

Dramatic increase in steel plants such as for the construction industry, vehicle manufacturers, machinary producers and so forth have called forth a demand for electric overhead travelling (EOT) cranes. Since the size of these plants are growing, the tonnages of these equiqments are growing too, with the average size being 50 to 70 ton.

The mining industry uses Goliath cranes, whilst the power industry and engineering industries use overhead cranes. Goliath cranes are also used for scrap handling.

Gentry cranes are hugely required for precast segment yards, and for bridge constructions, whilst specialized hoisting equipment is required for bridge launching girders (Project Monitor).

Other industries that show a large demand for cranes include the automobile and ancillaries, power, infrastructure construction, shipyards, capital goods manufacturers, general engineering and fabrication industries (Project Monitor, 2011).

One of the largest segments in India, aside from the construction sector and government that is interested in hiring and buying cranes is small time hirers. Their main interest lies in mobile cranes that can travel long distance between cities without needing to be lifted and transported on trucks. Most of these small time-hirers go for the large and precise TRX model 2319. Until recently, it was the pick and carry cranes that have traditionally been used for products, but the improved height and carrying capacity of the TRX is masking them popular with a growing population. The crane can also be used for plant erection and installation, and it is, paradoxically, significantly cheaper than the classical pick and carry product (Cranes Today. Online).

Potential for Next FiveYears.

The market for cranes is expected to grow by more than 5% by 2012 and more for years exceeding that, with India producing approximately 11,500 cranes by 2014. ((Crane Blogger, Pierini, E. (Sunday, 12 December 2010. India's expanding crane market, attractive, challenging prospect http://www.craneblogger.com/featured-articles/indias-expanding-crane-market-attractive-challenging-prospect/2010/12/12/)) Project monitor (2011) estimates a growth rate of 20 to 30% with many more Indian cranes exported. At the moment, India is trying to beat its Chinese competition with more locally produced cranes (equipment India).

Basistha (2008) reports that due to booming construction activity and government benefits, the demand in the manufacturing and supply of cranes is expected to outweigh supply and this situation may well continue until the government has completed its 11th Plan-based commitments on construction and infrastructure creations currently in full-swing. Domestic and foreign crane manufactures are hectically busy and will continue well beyond 5 years from now. Federal Engineers, for instance, has produced 2,500 cranes since 1973, of which 400 have been exported. Demands for exporting have been increased so that it totals approximately 60% of their turnover within the last few years, and Federal Engineers expects this demand to intensify (Hoist, 2006).

Approximately, 80% of demand requirements for cranes come from the power plant construction sector and this is expected to remain consistent with predicted demand expected from windmill as well as from refinery power projects. Demand for road construction will remain modest, but demand for pick-n-carry and industrial cranes will intensify. This will be due to buoyant export-import growth as well as real estate construction (currently posited at $60 billion) that will require increased manufacturing of tower cranes.

All of the following are currently in demand and demand for these categories will continue within the next five years: crawler cranes, truck mounted cranes, all terrain cranes, tower cranes, and pick and carry cranes and so forth. Also predicted for the next five years and beyond it the increase in production of cranes to countries such as Africa, Europe, and South East Asia.

Key Players & the scope for new entrant.

Domestic and foreign key players in the market include the following:

Federal Engineers which specializes in EOT cranes whilst also building Goliath cranes and overhead cranes. It owns five factories in Mumbai, each of which manufactures different parts of the crane

Electromech manufacturers specializes in single girder and double girder EOT cranes, goliath cranes, underslung cranes, as well as special purpose cranes