PUMP INDUSTRY.

OVERVIEW.

A Matured industry, the pump industry is one of the older industries existent from india that
has stagnated in growth lately due to the slump in economy and infrastructural development.

With a market capitalization of INR 6800 Crores, the major players in the market that are listed
are Kirloskar brothers, Shakti Pumps and WPIL having high share in the market.

The Indian Pump industry is growing at a scale because of increasing infrastructural

development needed by companies and agriculture to enhance productivity of crops and
efficiency related to cost. This will lead the near INR 10,500 Crores organized segment of the
industry to reach INR 15,000 Crores by 2020. The major segment that the industry thrives on is

 Agriculture
 Waste management services
 Building/ Infrastructure projects.

The industry has many different segments based on type of pumps being produced by the
manufacturer:

PUMPS

CENTRIFUGAL POSITIVE
PUMPS DISPLACEMENT

SINGLE SUBMERSIB MULTI – AXIAL & ROTARY RECIPROCA PERISTATIC

STAGE LE STAGE MIXED TING
RADIAL RADIAL
Centrifugal pumps have its major use in irrigation and agriculture, resultant to this , cheaper
versions- Single Stage Radial and Submersible pumps gain prominence in terms of market share
with 70% of the domestic consumption in Centrifugal pumps. The positive displacement pumps
are used for more commercial use in Power and oil & gas industry and the Rotary pumps are
responsible for 72% of the total production. However between the two segments, Centrifugal
pumps dominate the market with 92% of the sale coming from them.

OUTLOOK

Due to the recent macroeconomic slowdown and the near stagnation of the infrastructure
development, there has been tremendous pressure on the pricing of pumps due to less
demand in the industry. Some of the major known players in the market are as follows:

 CRI
 CROMPTION GREAVES
 KIRLOSKAR BROTHERS
 KSB P
 UMPS
 WPIL
 DYNAMITE TECHNOLOGY
 TEXMO.
 MARKET SHARE BY SALES
4%
5%
6%
KIRLOSKAR
BROTHERS
8% KSB PUMPS
DYNAMATIC TECH.
43% SHAKTI PUMPS
WPIL
YUKEN INDIA
12% OTHERS

21%

The opportunities in the pumps industry are plentiful in the coming years, partly because of
the infrastructure push that the NDA Government looks to give in 2014-2019, but also
because India looks to harness hydroelectricity for power generation and there is a growing
need for better agriculture produce and productivity, which will promote this industry by
boosting demand for high quality pumps.

FUTURE POTENTIAL
With an estimate production of around 2.5 million units, with only 5% of its total being
imported, it is imperative that the market has a high number of large and small players in the
pumps industry. In order to be competitive in the industry, focusing on key deliverable and
critical success factors will be essential for companies to gain a competitive edge. They should
hedge their risks of a price war by gaining increased margins in the industrial segment. By
focusing on a target market and a set of customers rather than expanding inorganically across
the industry and its products will help companies to grow internally.
Exports is also a key growth area as India does export to more than 100 countries with US and
Germany being major markets with 14 and 12 percent share respectively.
Direct expansion into the agriculture sector is seemingly tough, thus better marketing strategies
and tie-ups with critical partners like micro finance group shall ensure market depth.
All this does boil down to the fact that companies will only prosper if their product are
 Energy efficient
 Innovative
 High quality
 Manufactured at fully optimized costs.1

GROWTH DRIVERS FOR AGRICULTURE PUMP SETS2

• SINKING GROUNDWATER LEVELS IN THE COUNTRY: Coupled with the increasing incidence of
poor monsoons, this is posing a major challenge for Indian farmers. Therefore, the number of
pumps installed in the country is expected to increase over time.

• GOVERNMENT INITIATIVES: Both the central and various state governments have come up
with various policies, like heavily subsidized electricity and other schemes which has promoted
the use of pumps year on year basis.

• INCREASING PREFERENCE FOR QUALITY PRODUCTS: With globalization and increasing

market competition, there is a rising demand for high quality products. This is especially
applicable in the states where pattern of large land holding is prevalent, such as Punjab and
Haryana. Farmers in these regions are comparatively more aware about the benefits of quality
pumps. Increased levels of production have had a direct impact on the income levels of
farmers, and act as a key driving factor influencing the shift in priorities in pump selection from
cost to quality. This shift has provided an immense boost to the organised sector, encouraging
players to launch better quality pumps in the market.

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ngeninvest.com/pumps
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http://oaji.net/articles/2016/490-1474971578.pdf
• INCREASE IN DIVISION OF LAND: The continuous increase in population and the number of
nuclear families across India has prompted the rapid division of agricultural land, which, in turn,
has led to an increase in number of land owners. In addition, the increasing trend of, and
necessity for, independent irrigation facilities among farmers is driving the demand for the
agricultural pumps in rural India.

Indian Pump Industry – An overview

Pump market in India

Market research analysts at have predicted that the pumps market in India will grow steadily
during the predicted period and will post a CAGR of almost 10% by 2020. Owing to increased
consumption, the pump manufacturers have been concentrating only on the needs of the
domestic market, mainly to the agriculture and building services industries. The influence of
linearization, privatization, and globalization of the Indian pump market have compelled
manufacturers to export their products to foreign countries where the demand for pumps in
high in industries such as oil and gas, steel, and mining. Currently, the US and Germany are the
revenue contributors to the market. Factors such as the rising demand for oil and the increased
investments in water and wastewater treatment activities will have a huge impact on pump
exports in India, which will drive the demand for the market during the predicted period.

The pumps market in India will witness the emergence of intelligent pump systems and micro
disc pump technology in the next few years. Intelligent pump systems can control and regulate
the flow or pressure of the fluid, can adjust to process changes, and also have a fault tolerant
design, which will induce several manufacturers to adopt these pumps as they reduce the total
cost of ownership without compromising performance parameters. Also, the micro disc pump
technology will help manufacturers develop small-size and energy-efficient disc pumps that can
be used in medical applications such as wound therapy and blood pressure measurement.
India today exports pumps to 100+ countries

•       Is totally self-sufficient in

•       Captive power generation

•       Pulp and papers

•       Energy efficient pumps in utilities and agriculture

•       Is almost self-sufficient in pumps for nuclear power

Market Size of Pump Industries in India

•             The Indian pump market was worth over US$ 18 billion in 2019

•             India has over 800 pump manufacturers

•             India manufactures more than more than 1 million pumps every year

•             The Indian Pump industry offers excellent growth opportunities for international
collaborations

•             Indian Pumps are exported to more than 100 countries

 Indian Pumps – Market Segmentation by Share & Value

          

Industries Market Share

 Agriculture 27%

Building Services 19%

Water & Wastewater 17%

Management

Power Generation 12%

Oil & Gas 8%

Metal & Mining 4%

Others  13%

                 

Agriculture and Building Services comprise 46% of the market by value (INR 3910 crore). This
segment of the Indian pump market is highly fragmented as well as competitive – with a large
number of small and medium enterprises (SMEs) competing to increase their market share.

The biggest markets for agricultural pump sets are the central Indian states of Madhya Pradesh,
Maharashtra, Tamil Nadu, Karnataka and Andhra Pradesh.

The Industrial Sector comprises the remaining 54% of the market by value (INR 4590 crore).
This segment of the India pump market consists of sectors like Water& Sewage Treatment,
Power Generation, Oil &Gas, Metals &Mining and Others. Being technologically intensive, it is a
relatively hard sector for small and medium enterprises (SMEs) to penetrate.

Indian Pumps – Market Segmentation by Pump Type

•             Centrifugal Pumps                                           ~95%

•             Positive Displacement Pumps                          ~5%

Indian Pumps – Key Strengths:  Why Make in India?

•             India offers among the highest net value additions in the world (20%-plus)
•             A ready export market in 100-plus countries

•             16% of India’s pump manufacturing capacity is geared for exports (and growing)

•             Healthy domestic market for pumps in India – US$ 1.2 billion-plus (INR 8,500-plus
crore)

•             Technological capabilities to meet the highest quality standards – such as ISO 9000,
ANSI, API or EUNO series

•             Proactive government policies to stimulate agricultural growth (and demand for
pumps), through:

o             subsidized electricity

o             exemptions on use of solar water pumps

Such policies have inspired farmers to install independent irrigation facilities to ensure
consistent availability of water. As a result of these schemes, the demand for water pumps has
increased significantly.

•             Rapid growth of the Indian chemical market has stimulated the demand for high quality
industrial pumps

•             The growing demand for lower cost of operation and zero downtime pumps gives India
a competitive advantage to offset the labour cost advantage offered by low-cost/low-quality
manufacturers in some Asian countries

Indian Pumps – Growth Opportunities

70% of India’s US$15 trillion GDP projected for 2030 will have to be supported by urban
infrastructure – and will require massive doses of investment in urban infrastructure. The other
growth drivers for Indian pumps include population growth, higher water-intensive food
consumption, industrialisation, growing public awareness about drinking water quality,
decreasing water quality, lower water levels, and environmental pressure from government
bodies on wastewater discharge, thereby amplifying the demand many times over for the
recycle and reuse of water.

Segmentation by end-user and analysis of the pumps market in India

•             Agriculture

•             Building services

•             Power generation

•             Oil and gas

•             Water and wastewater

This market study estimates that the agriculture segment will account for about 35% of the
total share of the pumps market in India by 2020 and will also dominate this market throughout
the forecast period. The increase in consumption rate, rise in agriculture exports, the growth in
the food processing industry, and growth in organic farming will result in the growth of the
agriculture sector, which will subsequently increase the demand for pumps in the coming years.
Additionally, the expected investments from the government toward irrigation projects will also
drive the demand for the market.

The Government of India is actively encouraging technology development and transfer to

enable the small scale sector (i.e. small pump manufacturers) to enter high-tech areas such as
aerospace and defense

•             Indian companies are increasingly looking for international partnerships via technology
collaborations to enter foreign markets

•             Many small scale pump manufacturers have created price sensitive offerings as viable
alternatives to costly pumps manufactured by large pump manufacturers

•             The Indian chemical market– growing at a rapid pace – is fuelling the demand for
industrial pumps
•             Government regulations and energy crisis are motivating water pump manufacturers to
develop energy efficient products

The Government of India has introduced several policies to promote agricultural growth in the
country. These policies range from subsidized electricity to exemptions on use of solar water
pumps. The announcement of such policies has inspired farmers to install independent
irrigation facilities to ensure consistent availability of water. Consequently, this is pushing the
demand for water pumps in India.

Industry Clusters – Indian Pumps

Some of the major industry clusters for pumps in India include:

•             Coimbatore

•             Belgaum

•             Batala & Jalandhar

•             Kolhapur

•             Rajkot

•             Ahmedabad

•             Hyderabad

Quality Certifications for Indian Pumps

The Indian Pump industry complies with highest quality standards – such as ISO 9000, ANSI, API
or EUNO series.3

While India has been an attraction for more and more global players to set up shops in India,
our indigenous manufacturers have shown commendable entrepreneurship to foray into the
global market exporting to some 70-odd countries around the world with their own brand

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https://www.indianpumps.org.in/article_details/6
names, says S. L. Abhyankar, the Pitamaha of the Indian Pump Industry , reflecting on the status
and prospects of this dynamic industry in an interview with P. K. Balasubramanian. Excerpts:

Q. What you have to say on the economic scene in the country and how conducive is it to
accelerated alround growth?
Economy of the country and its GDP comprises contributions from Agriculture, Industry and
services. Pumps are important in all these. Status of the industry depends very much upon the
economic conditions of these sectors. Parameters of economics of these sectors themselves are
different.

In the agricultural sector, vagaries of monsoon, availability, quality and reliability of power and
purchasing capacity of the farmers influence pump industry. In the industrial sector, investment
climate is a major influencing factor. The market for pumps consists of project requirements
and replacement demand. Major influencing factor is of project-requirements and that depends
upon investment climate.

In the services sector, the major influencing factor is pace of Governmental initiatives,
especially for infrastructure projects, such as of power-generation, water supply, sewerage,
transportation, etc.

Q. How satisfying is the transformation and growth of the industry?

Salient points of growth of industry have been :

 Market for pumps in India has been some attraction for more and more global players
setting shop and also exploring setting up manufacturing facilities in the country.

 On the other hand, indigenous manufacturers have shown commendable

entrepreneurship to foray in to the global market, exporting to some 70-odd countries
around the world, with their own brand names. This performance is of course
influenced by the economic conditions around the world, which, unfortunately, have
not been very positive over the last few years.
  Governmental support to promote exports has not been worth mentioning. Also it
makes poor comparison with Governmental support in countries like China. So, if Indian
pumps are getting exported to as many as 70-odd countries, the credit should go to
entrepreneurship.

 The export performance also evidences that the industry has matured in all related
aspects of engineering, technology, and quality.

Q. When it comes to contemporary technology, are we in step with the world?

One aspect of contemporary technology is use of tools such as Computational Fluid Dynamics
(CFD). A few years back, the technological up-gradation started with manufacturers having
computerized pump testing facility. That seems to have become almost an industry norm.
Mention of CFD also does not cause eyebrows to be raised any more, though the costs are yet
prohibitive for its use to spread.

Manufacturing technologies such as sheet metal construction were thought to be capital-

intensive a few years back. But it seems that the technology has become sort of indigenized.
Similarly, impellers and casings to be replaced by by investment casting process was also not
cost-effective a few years back.

Some of our frontline manufacturers are striving to be global players, figuring in the top slot.
What are the challenges they are facing?

Q. World-ranking of manufacturers does not really make a clear picture?

 Pump-manufacturers world-wide often have their turnover comprised not just of

pumps. In many cases they have package-units of pumping systems for different
applications or have project-activities such as EPC contracting.

 Recognition as global player has many connotations. One connotation also comes from
having manufacturing plants at many places around the world. An alternative to setting
up manufacturing plant is to acquire existing manufacturing plants.
  Such venturing becomes a matter of corporate strategies of marketing and fiance-
management. Becoming a global player, to my mind, should not be looked at as an
objective in isolation. It should happen as a natural sequel of the corporate strategies.

 I have seen even so-called global players having 3-4 competing brands under one
umbrella. I am not convinced of such acquisitions.

Q. These days there’s so much of stress on energy efficiency of Pumps. What are the efforts of
the industry to develop energy efficient products?
Energy-efficiency of pumps should not be looked at as energy-efficiency of only the pumps. A
good pump in a bad system cannot be as energy-efficient as it should or can be. Yet, it is not
illogical to demand the pumps to be energy-efficient by themselves. If the system is good and
the pump also energy-efficient, it becomes the most appealing and satisfying achievement.

The subject is a matter of concern, specifically in the agricultural sector, where the user, the
farmer is not literate, much less, pump-literate. The farmer also pays almost nothing for the
energy consumed for agricultural pumping. It was possibly with these considerations, that BEE
took the initiative to evolve a star-labeling scheme for agricultural pumps. Unfortunately, the
scheme is still having too many pit-falls and hence has not been able to make any impact in the
market-place.

In industries pumps are procured, installed and run with quite some technical manpower
involved at all stages. Yet any number of pumping systems in industries may not be as energy-
efficient as they can or should be. In most cases the engineering personnel are not adequately
‘pump-literate’. In industrial pumping, demand for reliability may often cause compromise with
the need for energy-efficiency. Even the standard API-610 has been mentioning “efficiency’ not
being the all-important criterion.

In many large infrastructure projects capital cost of pumping machinery may be barely 5
percent. Yet the success and overall positive assessment of the project would be dictated by
the performance of the pumps. Even in human body of average weight of 60 kg, weight of heart
is 250-350 g. (300/60000 = 0.5 %). But performance of the heart makes the difference between
life and death !

Q. How has the growth of the industry impacted the common man?
Role of pumps in life of common man remains in the background, primarily because it is taken
for granted, that if a pump has to work, it has to work. Change in lifestyle is often associated
with pumps doing some important function, which is taken for granted. For example, if
shopping malls have become a significant aspect of change in life-style, shopping malls have to
have all the vast space air-conditioned.

The system of air-conditioning cannot work without the pumps working. The common man is
blissfully unaware of this, because the basic fact that shopping malls have to have all the vast
space air-conditioned, is itself taken for granted and in turn the pumps therein. High-rise sky-
scrapers seem to be becoming the order of the day, especially in Mumbai, which is constrained
to grow only vertically, since, it has limited space to grow horizontally. High-rise structure
inherently means pumping to raise the needed water-supply that much up. 4

Escalation in urbanization and industrialization, in conjunction with depleting

groundwater, set to drive India water pumps market over the next five years.

According to a recently published report by TechSci Research, “India Water

Pumps Market Forecast and Opportunities, 2020”, the market for water

pumps in India is expected to witness rapid growth at a CAGR of around

12% during 2015-2020. Market growth is driven by increasing urbanization,

leading to high growth in residential and commercial segments. Growing

dependency on groundwater and irregularity in monsoon are catalyzing

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demand for water pumps in the agricultural segment. Government efforts

to improve water infrastructure, water supply and sanitation services across

the country are expected to further drive the use of water pumps in the

country.

Besides agriculture, a significant share to the country’s water pumps market

is contributed by the industrial sector, where power plants, chemical

manufacturing and water & wastewater treatment are the prime application

areas. Rapid penetration of desalination plants in industrial sector is

consequently boosting the demand for water pumps in this segment.

Around 15 desalination plants announced in 2014, would be launched in the

country over the next few years. Growing demand for desalinated water is

driven by depleting per capita water availability which is motivating India to

explore alternate sources of water.

In combination with water treatment industry, water pumps are also gaining

traction in power sector. According to the Planning Commission of India, the

government targets capacity addition of about 72,000 MW thermal power

plants during the 12th FYP, surging demand for water pumps in the country.

Magnetic drive based water pumps, EPC (Engineering, Procurement and

Construction) based water pumps, and mobile phones used as remote

controllers for administering water pumps are some of the innovative

products being introduced in Indian market.

“India water pumps market is projected to grow at a CAGR of around 12%

during 2015-20. However, this growth is sluggish, given the past growth

scenario, primarily due to decline in real estate market. Although, the impact

of decline on future growth of water pumps market is only marginal, since

recovery is projected in real estate construction sector. In addition, a slight

decline is observed in the production of vacuum tower bottom products

such as furnace oil and fuel oil. Moreover, despite fair performance of

domestic market, imports of low cost Chinese pumps are increasing. Given

this scenario India water pumps market is anticipated to grow at a

marginally lower rate than growth during the past five years.” said Mr. Karan

Chechi, Research Director with TechSci Research, a research based global

management consulting firm.

“India Water Pumps Market Forecast and Opportunities, 2020” has

evaluated the future growth potential of India water pumps market and

provides statistics and information on market structure, industry behavior,

trends and trade dynamics. The report includes water pumps market

projections and demand forecasting. The report is intended to provide

cutting-edge market intelligence and help decision makers to take sound

investment evaluation. Besides, the report also identifies and analyses the

emerging trends along with essential drivers, challenges and opportunities

existing in water pumps market in India.5

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https://www.techsciresearch.com/news/318-india-water-pumps-market-to-grow-at-around-12-till-2020.html
CONCLUSIONS

Out of the surveyed farmers, it was found that the higher water output from the pumps was
the most important factor behind the purchase of pumps followed by proximity of specific
brand dealer, low voltage compatibility, price, brand name, guarantee/warrantee, low
operating cost, credit facility, and quality standards such as ISI mark.

The study elicits a lucid picture on sales of different pump brands in outlets. Market Share of
Shiv Shakti pump was highest; V-guard, Luni, Unnati, KSB, Jagdish, Kirlosker etc were other
major players. The Standard Agro Engineers had about two per cent share in the market.

The market provides good opportunity to expand; the estimated potential sales could be of
Rupees Eighty Five Crores and Twenty Five Lakh, considering those farmers too, who hire the
pump for their on farm needs. From the study, it was found that frequent breakdown/ burnout
of the pump set was the major problem faced by the farmers, followed by low lifting capacity,
Non-availability of repair and maintenance facility in close proximity, low poor efficiency of
pump, and low voltage.