Construction chemicals: building better tomorrow
An in-depth analysis on construction chemicals industry: the present market scenario, the challenges, the government policies, and the growing future
Use of construction chemicals is still negligible as far as construction market in India is concerned; however, several companies are innovating different approaches to leave a mark in the industry. We talk with industry experts to find out how they are making the difference.
T. D. Prathaban, Director and Chief Operating Officer, Cera Chem, said, “The use of construction chemicals is not negligible but they have now become indispensible in construction industry. A good majority of contractors, consultants and owners, especially in large Indian cities, know that construction chemicals will not only help in improving the quality of construction but also bring down the costs and accelerate speed of construction.”
Swapnil R Deshmukh, Marketing Manager at Chembond Chemicals observes, “Increase in manufacturing activities, industrial growth, and heightened investments in infrastructure and real-estate including high levels of investments by the Government are likely to be the main drivers for the construction chemicals market in the future.”
He adds, “The Indian consumers are slowly opening up to the concept of using construction chemicals as a part of the construction works and becoming aware of the long-term advantages of using these chemicals during construction activities. The consumers are becoming more educated and demanding better-quality work from contractors, due to which they have started using construction chemicals.”
In order to improve situation for use of construction chemicals, Fairmate Chemicals has trained 100,000 masons, more than 50,000 engineers and about 2,000 retailers.
Growth prospectThe construction chemicals industry is fast growing and has a potential to grow to Rs.5,000 crore in couple of years from the present value of Rs 2,000 crore. “The rate of growth in construction chemicals is around 20 per cent,” explained Bhavesh B. Shah, Joint MD, Fairmate Chemicals. “There is an increased emphasis on high-quality construction requiring detailed designing, good workmanship and the selection of appropriate building materials. Therefore, the demand for construction chemicals for renovation or building of these new, existing buildings has been on the rise in great speed.”
Mr Deshmukh believes, “The future for the construction chemicals market appears bright. The market has been growing at a steady pace from the year 2000 onwards and the trends suggest that the growth areas are admixtures, waterproofing, and repair and rehabilitation products. Increase in manufacturing activities, industrial growth, and heightened investments in infrastructure and real estate form the backbone of this dynamic growth.”
Growth driversThe industry has much more potential to grow. According to Mr Shah, “Easy adaptability to foreign technology and the entry of foreign companies in the construction sector have helped change the mindset of the people. The new construction projects market is also expected to increase the demand for construction chemicals. Apart from this, growth will be primarily driven by increasing construction expenditures in improvement and repair projects and also in infrastructures. The construction market is expected to grow at more than 30 per cent per annum for the next few years.”
Mr Deshmukh opines, “Indian manufacturers of goods and services are emphasizing compliance with the industry best practices in order to successfully compete with their international counterparts. This has led to the improvement in their infrastructure and the working conditions in the plants. Such a trend has positively impacted the flooring compounds market and is expected to continue to drive it during the forecast period.”
Promoting the industryThe industry has taken several steps to promote it: the manufacturers for construction chemicals in India has formed the Construction Chemicals Manufacturers Association (CCMA) in 2012. “The main aim of this collective forum is to promote and accelerate the growth of construction chemicals in India and to be a constructive forum to communicate with the government bodies, associations, chambers of commerce and other commercial industrial and public bodies within or outside India,” said Mr Prathaban.
Different construction chemicalsConstruction chemicals are like vitamins; these are not only used during construction process but are also used to enhance the performance of a structure. Mr Prathaban classified the products into admixtures, waterproofing systems, coatings for concrete and reinforcing bars, surface treatments, repair and rehabilitation, etc. There are also miscellaneous construction chemicals which can be used to enhance construction activities.
Emphasis on green buildingsA lot of emphasis is given to green buildings. Indian construction chemicals industry is also catching up for eco-friendly products. Mr Prathaban explained, “India with its varied geographical terrain and climatic zones represents a unique market where construction chemicals manufactures have to be on their toes and listen to the end users for bringing their products tailored to suit their requirements including eco-friendly products and satisfying the norms and requirements of green buildings.”
Research and developmentThe Indian construction chemicals industry is gradually shifting from price conscious to quality conscious market. A few construction chemicals manufacturers are establishing R&D labs in India. Mr Prathaban added, “The quality of construction chemicals can be maintained by establishing approved specification and standardisation by setting up of testing laboratories of developing R&D establishments.”
According to Mr Shah, the major R&D is going on in admixture front and waterproofing-related products.
ChallengesThe industry is also facing the challenges of unskilled labourers and low entry barriers. Being asked as to how to cope with the challenges, Mr Prathaban said, “Imparting training to the technicians and workers in construction chemicals is of paramount importance. Several organisations of CCMA are now taking efforts in this direction.”
Construction chemicals companies have now started concentrating on training and development of labourers along with the development of new products. “Meets and workshop are being arranged which includes on-site training and correct usage of chemicals. Few organised companies have also come out with applicator care cell which helps them in providing right kind of solutions for their problems,” Mr Deshmukh said.
Foreign players’ entryThe good news is that the foreign players are coming to India in huge numbers, developing the technical know-how. “The Asian market has been considered as a huge developing market by all the global players,” Mr Prathaban echoed. “The infrastructure segment in India foresees a wide scope of development and is evident with many R&D labs and manufacturing plants being put up by various global manufacturers.”
According to Mr Shah’s opinion, there is huge potential in Indian market. He said, “All the major foreign players have already established in India which shows that Indian construction is growing in a big way.”
However, Mr Deshmukh feels, easy adaptability to foreign technology and the entry of foreign companies in the construction industry have helped to change the mindset of the people. He said, “The government’s decision to give 100 percent FDIs in real estate business has boosted the growth of construction activities throughout India.”
Concern on government policiesThe only concern for the industry is the government policies. “The government regulation needs to be improved as there are lots of loop holes,” emphasised Mr Shah.” Like others Fairmate Chemicals is also working with various government bodies. “By improving the government regulation, the industry can build a better India tomorrow,” Mr Shah concludes.