Indian Construction Market Its Potential

This is about the potential of the Indian Construction Industry

1. INDIAN CONSTRUCTION MARKET
ITS POTENTIAL
General Presentation

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•The construction sector in India
contributes to a growth of 6.9% at an
estimated value of USD 80 Billion to be
attained by 2010.

3. C
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•87 Key Players in India account for nearly one-third of
growth, while the rest is distributed amongst the 25,000
small players, making the industry highly fragmented.
•Larsen & Toubro is the largest infrastructure company in
India followed by Punj Lloyd, Reliance Infrastructure
and IVRCL.
•DLF Universal is the largest property development
company in India followed by Unitech and Omaxe.
•With huge order books these companies are having, the
country is poised towards a better construction and
infrastructure growth during the 11
th
Plan Period ending
2012.
•Apart from these companies, which are private, there
are the public ones like BHEL, NTPC, ONGC, IOC and
other petro, energy, power and hydro generation
companies, having a great pipeline of projects in diverse
fields.

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Power
•Additional power generation capacity of around 78,500 MW
Roads & Highways
•Six-laning 6,500 Km of Golden Quadrilateral and selected highways
•Four-laning 6,736 Km on North-South and East-West Corridors
•Four-laning 20,000 Km on National Highways
•Widening 20,000 Km of National Highways to two lanes
•Developing 1000 Km of expressways
Railways
•Constructing dedicated freight corridors between Mumbai-Delhi and
Ludhiana-Kolkata
•8,132 Km of new railway lines; gauge conversion of over 7,148 Km
Seaports
•Capacity addition of 485 million tonnes in major ports, 345 million
tonnes in minor ports
Airports
•Modernisation and redevelopment of 4 metro and 35 non-metro
airports
•Constructing 7 Greenfield airports
•Constructing 3 airports in North Eastern Region

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Telecom
•Achieving a telecom subscriber base of 600 million, with 200 million rural
telephone connections
•Achieving a broadband coverage of 20 million and 40 million connections
Irrigation
•Developing 16 million hectares through major, medium and minor
irrigation works
•2.18 million hectares flood control
Source: Planning Commission
Physical Targets for Infrastructure in the Eleventh Plan

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•L&T’s order book likely to swell to INR 70,000
Crore (USD 15 Billion)
•Specialised in multi disciplinary construction
ranging from roads, bridges, airports, Hydro
Electric Power, IT Parks, Trade & Exhibition
Centres, Ports, Water Supply Projects and
Residential / Commercial Complex Projects in India
and abroad.
•Major projects include the Delhi International
Airport Ltd (DIAL), Bangalore International Airport
Ltd (BIAL), L&T Infocity as JV with various partners,
IT Park for TATA Consultancy Services, a 60 MW
hydro electric power plant project, HITEX,
Integrated Ship Complex project and many roads
and bridges projects.

7. M
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•Punj Lloyd ranks #107 among the top 225 Global
Contractors for Y2008.
•Punj Lloyd’s order books are at INR 30,000 Crore
(USD 6.5 Billion)
•Major projects include a resort development in
Libya, Jubail Export Refinery project in KSA, MRT
Station in Singapore, Bangalore Metro Rail Project.
It has also got a great presence in the Middle East
and Libya.
•Punj Lloyd recently has signed a MoU with
Thorium Power Ltd, the leading developer of non-
proliferative nuclear fuel technology and provider
of comprehensive advisory services for the
emerging nuclear programs.

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•Reliance Infrastructure is the country’s largest
private sector enterprise in power utility involved
in generation, transmission, distribution & trading
of electricity.
•Goldman Sachs reports that Reliance Infra has an
order book of USD 3 Billion, which is expected to
cross USD 7 Billion in the mid term with a high
visibility of winning projects worth USD 4.2 Billion
•The order book is dominated by the power sector
but Reliance Infra is building its expertise in urban
infrastructure, cement, steel and airports.

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•IVRCL operates on sectors like water &
environment, transportation, buildings
and power.
•The value of IVRCL Order Book stands at
INR 16,000 Crore (USD 3 Billion).
•65% of the order book value is in the
water business. IVRCL is the preferred
bidder for the Sion Panvel Project worth
USD 324 Million and major National
Highway projects all over country.

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•CCCL India is an ISO Certified company, having presence
all over India, with a recent opening of an office in the
ME.
•CCCL India’s order book stands at INR 4000 Crore (USD
864 Million).
•CCCL India executes the Chennai Airport expansion
project and the Trivandrum airport expansion project.
Other projects include a factory for Apollo Tyres,
Ascendas Property Management, Factory Building for
Suzlon Infrastructure, Lemon Tree Hotels, Rain Tree
Hotels etc.
•CCCL India has recently bagged order from Delhi Metro
Rail Corporation, from the Union Government to set up
a food processing SEZ in Tamilnadu, from ONGC to
construct their office complex in New Delhi.

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Characteristics of Indian market
•Strong service sector; industrialisation
gradually picking up speed
•Reliance on Public Private Partnerships
(PPP)
•Urbanisation and redevelopment of slum
areas
•Interstate bureaucracy and conservative
political mindset favoring incremental
changes

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Infrastructure
•Government targeting an investment of
USD 20.38 Billion over next 2 years
•Scheme aims to take up projects under
PPP with minimal private investment
•Infrastructure Investment Finance
Company Ltd (IIFCL) has been asked to
put together a corpus of USD 8.15 Billion
for this purpose
•Index for the six core industries – crude
oil, petro and refinery products, coal,
power, cement and finished steel has
turned in a growth of 6.5% in June 2009

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Ports
•276 ports have been identified entailing
an investment of USD 12 Billion
•Planning Commission states, “there is an
investment opportunity of USD 25 Billion
by 2011-2012 in India’s shipping and
ports sectors, as the country seeks to
develop its ports capacity to 1500 million
tonnes
•Of the USD 25 Billion investment, USD
13.75 Billion would be for ports and USD
11.25 Billion for shipping and inland
waterways

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Airports
•PPP mode to develop over 300 airports
and airstrips
•Investment of USD 9 Billion to modernise
the existing airports by 2010
•35 Greenfield airports at an investment
of USD 35 Billion by 2012
•“Investment in airport infrastructure was
over USD 5 Billion in 2008 and would go
up by USD 9 Billion by 2013, of which
close to USD 6.8 Billion is expected to
come through the PPP model” – Frost &
Sullivan

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Ultra Mega Power Plants – UMPP
•Govt of India has envisaged a capacity
addition of 100,000 MW by 2012 and to
meet the objective, large generating
capacity power plants are being formed,
termed as, UMPP
•UMPP will have a capacity of 4000 MW
with features for future expansion as
well
•The 5 UMPPs which have been identified
under the first phase are at Sasan,
Mundra, Akaltara, Karnataka and
Maharashtra

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Other Major Projects (Nascent/Planning Stage)

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Other Major Projects (Nascent/Planning Stage)

19. C
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“.. despite serious pitfalls, the Mumbai Makeover project is
an ambitious USD 60 Billion refurbishing plan to support
the transformation of the city into a global hub. This
creates attractive niche construction opportunities,
even during these times of economic hardships..”
- Bhaskar Raj, Senior Strategy Consultant
Solidiance
“…. A key factor which is responsible for the stupendous
success of the Indian construction industry is the
political will of the successive governments since 1991.
India, with its abundant land mass and population, is a
major market for infra and property development. Thus,
the Indian Construction Industry is set to achieve its true
potential of being a world beater, which clearly suggests
the huge opportunity for various industry players…..”

20. R
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•http://www.slideshare.net/dduhamel/construction-industry-china-india-2009
•http://www.pmrpublications.com/press_room/en_Immense-potential-in-the-
Indian-construction-market.shtml
•http://www.dnb.co.in/Infrastructure2008/overview.asp
•http://economictimes.indiatimes.com/News/Economy/Infrastructure/Indias-top-
infrastructure-players-thrive-despite-adversity/articleshow/4989155.cms
•http://www.financialexpress.com/news/l&ts-order-book-likely-to-swell-to-rs-
70-000-crore/447379/
•http://steelguru.com/news/index/2009/09/18/MTEyMjM4/Reliance_Infrastructure
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order_book_crosses_USD_7_billion_mark.html
•http://www.tubaah.com/details.php?video_id=100100
•http://buzzingstock.in/market-news/cccl-bags-order-worth-rs-431-cr-from-
•http://www.mydigitalfc.com/companies/cccl-bags-delhi-metro-order-739
•http://www.ibef.org/economy/infrastructure.aspx
•Other Company Websites