MAGAZINE SECTION
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UPS Industry Records 5.7% Growth...
COVER STORY
Power Electronic Industry Analysis Year Ending March 2019...
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Classification of UPS Battery - a Costly interruption?...
MID-YEAR ANALYSIS
Softdisk Findings, 2019-20 : Growth Projections for March 2020...
SOFTWARE
WINDOWS 7 : Too good a software...
BUSINESS
Retailing Market : Now making a statement...
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Gender Equity : Not an even match...
TECHNOLOGY
Technology : The new education Enabler...
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Evolution and Direction of Intelligent Network Architecture...
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Wireless IP-based communications architecture...

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MID-YEAR ANALYSIS
Softdisk Findings, 2019-20 : Growth Projections for March 2020

Softdisk which has the history of constantly upgrading its information thru various surveys has been monitoring the UPS industry for well over two and a half decades now. We have become synonymous with the UPS Industry and are constantly on the lookout of data. According to our latest findings, the Indian UPS market which is currently growing at just over 3.72% but this is temporary phase due to elections and as the magazine hits the stands growth would have picked up.

With Modi Government firmly in saddle it is expected to cross 7033 crore mark by March 2020. Indian economy will definitely get a boost. This include around 200 crores of sales coming through unorganized sector and secondary sales. By March 2020 the industry is expected to grow by 6.20 % which is lower in comparisons with overall market growth which grew by 8.90% in the previous fiscal. However, By 2022 India Power Electronic Industry will have over 10% growth these are conservative estimates, A dip of nearly 2.70% over last year will certainly grow up by over 10% by 2022, when we celebrate 150 years of centenary of Our Father of the Nation. How companies benefit depends solely on their approach. Most SPCU manufacturers will be florish & will boost growth by 2022.

Companies looking for bottom line will have to face pressure form companies looking to improve top line. How ever if survey is a an indicator that private sector will open up during & post festive season making it little suitable for those looking for bottom line. Banking sector will be a cause of concern as they insist on lowest bid. I had lot of complaints of not getting proper service, I met DIT purchase of many banks explained them that service is related to purchase price, when companies sell at very low margins they find it difficult to service after 2 years. There is further scope of consolidation, with big companies not hotly pursuing lower kVA products. Also the amount of consolidation taking place in the Industry, probably is due to fact the more & more UPS companies are experimenting with solar enabled UPS & SPCUs. This is happening more at the level of smaller companies. It is not about acquire or take-over but about co-existence. This time a lot of emphasis was given on low key players who are in search of different market share for example like Cosmic, Powernet, TPC, Arrow, Suvik, Vespra, ARVI, Miron, Impaq to name of few.

A GREAT ACHIEVEMENT IN THIS COMPETITIVE PRICING TIMES.

This is exclusive figure for UPSs (Sales, Services & Maintenance) & Power Electronic Devices, excluding cooling solutions, home UPSs and other add-ons with GST. This is suggestive of the fact that India’s growth engine which slowed down due to elections will start as there is a stable government back in the saddle which is pro development in infrastructure. functioning, at a bit faster then previous financial.

To counter the increasing prices of batteries many a companies have started sourcing the batteries through OEMs, although still the quality conscious customer insists on branded batteries.

These estimates have been generated by a survey when the industry was seemingly at the end of a tough phase post GST implementation & Compliance, where we had mixed reaction form manufacturers and customers alike, through a tough phase after experiencing a tremendous drop in Rupee against the US$ and hence might have a 2 to 3 % aberration.

Softdisk believes that the current expected rate of increase by approximately 9.32% & overall turnover by March 2020 including unorganized sector will touch 7000 crore mark including secondary sales. However nearly 300 crore of this will be through unorganized sector surely indicating that end user consumption of organized companies product will in all probability will cross 6700 crore mark even at the worst of its performance.

BIS compliance is another key factor, in reducing the competitions and increasing margins. More Modular UPS will be in demand and line interactive market will slowly decline it will difficult for companies to maintain the current sales level. Modular UPS allows end user to invest according to their actual load, and to upgrade their systems while their business grows, without hampering uptime, reliability, availability. The market demands UPS system with high efficiency even at partial load to reduce the operating cost and to be a part of green revolution.

The report has been generated by talking to more then 450 companies under various vertical and talking to over 500 people who are direct decision makers. All 450 plus companies we talked to had near 200 employee strength and have presence in almost all the regions in the country. There is an indication for more demand for single phase up to 20 kVA (around 60 %) & Three phase UPSs (around 40%). Off all this Modular UPSs share is about 35%. Demand for Industrial UPSs will slowly rise. Rest of the revenue being accountable for services and other equipments.

Survey shows that this shift towards Modular UPS is primarily due to the hot swapping features & the flexibility they offer in terms of redundancy. But this trend is mainly for Corporate, IT & ITES companies. The market demands UPS system with high efficiency even at partial load to reduce the operating cost and to be a part of green revolution. The firms in India will have to make great leaps in application integration. In addition, India's cultural diversity, corporative federalism, and socio-economic disparities make it a microcosm of the broader South Asia region.

Softdisk expects, smart vendors to use India as a testing ground for new business models and strategies to try out models for the next wave of emerging economies. Though India & South East Asian economies are closely connected to each other through trade and cross investment, they differ enormously in their levels of economic development and the state of their IT infrastructure.

The report indicates that the regional growth will be as follows :

NORTH : Last year the over all Northern market had grown by 6%, we expect it to go up by 8%. Leave apart power continuity, availability of Power especially in states of UP & Bihar has been a point of concern. There will a marked raise in Government purchase in the north. (Allready visible) Followed closely by IT, ITES and BPO segment. SMB will also be a significant contributor especially in the state of UP, Rajasthan & Bihar. Overall North will contribute 25 to 27% of expected 6700 crore by March 2020.

SOUTH : Here a surge of nearly 4% is expected in coming two years. South is expected grow at a rate of 30 to 32% and will contribute over 2100 crore INR to the UPS revenue of the country by March 2020. Off this Karnataka, Tamilnadu & Kearla will be the major contributor. However a new state of Semandhra & Telangana will not lag behind but for this supports from the center will be one big factor. In this Semandhra seems to be at an advantage. Other then Banking, one can expect Corporate business to be contributing more and IT / ITES, BPO's to contribute revenue in these states. Education, will be another major contributor.

EAST : Nearly 1400 crore revenue will be generated by the sales of UPSs in the East by March 2020. Govt. buying will dominate, many a planned projects will start getting executed. In the overall scenario East will be contributing somewhere between 21 to 23% of total revenues by March 2020.

WEST : In the west overall contribution will be some where between 20 to 22% of the total national UPS revenue. West will pocket over 1500 crores of the total revenue of 6700 crore by March 2020. Major contributor will be Govt. buying will contribute 31% of West revenue, Gujarat & Corporate buying and IT / ITES, BPO's & Services & Industrial Process Automation will be major contributor nearly 25% of revenue will be churned out by this sector. SMB will be a major contributor in Madhya Pradesh.

Vertical wise bifurcation:

This indicates Banking, Insurance & Finance sector contributing 8% approximately 775.72 crore INR. Other major contributor being the government sector which is expected contribution is being well over 1456.51(Direct & thru SI) Crore, nearly 24% of the total UPS revenue. Indicating a gain of 1% over previous year. IT / ITES & BPO sector contribution is expected to net 931.47 Crores, a share of nearly 15% in the overall UPS revenue. While Corporate buying shows the results as last year in percentages terms & is expected to grow at the rate of approximately 7% netting revenue of above 788.16, an increases of over 50 crore in revenue terms.

Another major contributor this year will be Industrial process automation with high capacity CNC Machines being installed high end UPS systems which can use regenerative load as in put source will be more popular. A clear increase from the last year levels in revenue terms. The trend indicates that those selling higher kVA ratings will be the one to watch out for as they may clinch the CNC deals. Those coming up with cutting edge technology will be at an advantage. Companies selling to Govt. concerns will be at a benefit. Research & Educational Institutions will be a key area of interest to those catering to their needs, this sector will contribute over 425 crore. Hospitality sector will have there own share of the pie. SMB segment contributing over 850 crore nearly 14% augers well for the small players with the small UPS systems, there is still a lot to vie for, if they have commitment to quality.We expect the total revenues to be 7032.90 crore, i.e. 7000 crore approx.

Softdisk is proud of the fact that the SMB segment will be contributing over 850 crore indicating that its effort to educate the masses over the period of last two & half decades, has finally started paying dividends. You pat us or not, we are certainly patting our back.
 

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