Market Potential of Panache Products

 Construction Chemicals

The growth of construction chemicals is driven by growth in the construction industry. Increasing investments in both new construction and improvement and repair projects will drive the demand for construction chemicals. With the new government focusing on more investment in infrastructure and affordable housing, the construction chemicals business is hoping for positive change

The construction chemicals industry has evolved significantly in past decades. Construction chemicals business is very much dependent on infrastructure and real estate sectors. With the new government focusing on more investment in infrastructure and affordable housing, the sector hopes for positive changes. It has been growing at 17 to 18 per cent per annum. With increasing demand and promising end use market growth, the construction chemicals industry is expected to grow much faster in the coming years.

The growth of construction chemicals is mainly driven by growth in the end use industry i.e. construction industry. Increasing investments in both new construction and improvement and repair projects will drive the demand for construction chemicals.

The Indian construction chemicals market size is Rs.4, 000 cores which is pegged at about 10 per cent of the Chinese market.

The waterproofing market in India is at a very premature state, since the bulk of the construction sites use traditional methods like brickbat coba and mud puska which have their own limitations. Hence, we see this as an area where huge opportunities exist. There is an urgency to inculcate the right material usage, right dosage and the correct application to ensure that we create healthy structures.

As far as development in the construction chemicals industry goes, there has been a strong growth rate of 17 per cent per annum.

Development Alternatives

 The construction chemicals market has a huge growth potential due to the construction and manufacturing boom in India. Many newly developed products give better performance and results and hence there will be a shift in demand towards products offering better performance (source:  FCCI report on construction chemicals industry).

The industry’s biggest challenges are low awareness regarding the benefits of construction chemicals, inadequate knowledge on proper usage of these chemicals and lack of enforcement of quality standards on construction activities. About 85 per cent of contractors and builders are not aware of the key advantages of using construction chemicals and have limited knowledge on their proper applications (source:  FCCI report on construction chemicals industry).

Construction chemical is one of the niche segments from the specialty chemical segment of the chemical industry. Construction Chemicals are specialty products that are used in structures   to   increase   their   life,   and   also   to   impart   additional   protection   from environmental hazards. Certain chemical products also help in minimizing the quantities of cement and water generally required during the construction.

In India there are a large number of buildings which are more than 40 to 50 years and which need renovation. The new laws provide for demolishing existing old structures and constructing   new   high   rise   buildings.   Consequently,   therefore   the   demand   for construction chemicals for renovation of these existing buildings has been on the rise in the short term. Additionally, the tropical climate, and the inferior construction material used by builders also cause many of these building to need repairs much earlier. Sub- standard construction chemicals have been used in a large number of construction projects.

The new construction projects market is also expected to increase the demand for construction chemicals. The construction market is expected to grow at more than 30% p.a. for the next few years. There is no published data available indicating the exact growth rate of the construction market. The Indian construction chemical market is highly competitive and fragmented, with large numbers of small and specialized suppliers. In addition to small distributors who import these chemicals, there are a large number of global construction companies who have their local manufacturing operations in India. This market is likely to grow at the rate of around 10 – 15% p.a. in the next few years.

Most companies tend to be highly specialized in serving their specific market segment. They generally supply a few product types of different technology/application methods, quality and price to solve specific construction needs such as waterproofing, leakages orfireproofing. In general, the distribution of each particular product involves installation/application and most importantly a warranty on product performance. As a result, it is necessary that distributors of construction chemicals specialize in solutions to specific construction needs.

A variety of construction chemicals are used in most large-scale construction projects as well as projects of special design and engineering, depending on their specific needs. These materials include concrete admixture, surface treatment, waterproofing, grout, floor topping, coating, sealer and floor hardening. Therefore, the potential demand for construction chemicals expands to cover the creation of infrastructure, high-rise buildings and industrial plants. In addition, construction chemicals also cover the renovation and repair of such large-scale projects. In fact, renovation and repair make up a substantial volume of construction chemical sales in India.

Construction   chemicals   comprises   of   a   number   of   different   products   such   as cementations,  cement  admixture,  cold-applied  products,  hot-applied  products, membranes, acrylic, epoxy, resin, and sealant /adhesive. Because the market has a large number of suppliers and products, the majority of suppliers are small distributing companies without a large enough market share to effectively influence the overall market application of construction chemical.

Types of Construction Chemicals: -

Construction Chemicals can broadly be categorized into five groups:

1. Concrete and Mortar Admixtures.

2. Water Proofing Compounds.

3. Floor Hardeners.

4. Protective Coatings and Resins.

5. Adhesives and Sealants.

COMPARISON BETWEEN CONSTRUCTION CHEMICAL AND CONSTRUCTION INDUSTRY GROWTH RATES –

*The figures are in Rs. Crore

	2002- 03	2003- 04	2004- 05	2005- 06	2006- 07	CAGR %
CC Industry Turnover*	750	855	992	1130	1500	18.06%
Rate of Growth of CC Industry	13%	14%	16%	18%	20%
Construction Industry Turnover*	31078	36015	42885	48679	51200	14.20%
Rate of Growth of Construction Industry	16.55%	15.88%	19%	22%	23.70%

CC=Construction Chemical

Source: Chemical Weekly

In the above exhibit we can see that the growth rate of the Indian Construction Chemical Industry is consistent. This shows that the application of construction chemical in construction works is increasing gradually. The end users are coming to know about its usage. But to give a healthy boost to the construction chemical industry there are certain weaknesses and threats that need to be addressed which we will see in the further part of the paper.

Trends over the  last few years have indicate that the growth areas in this industry are admixtures and repair system products. Increase in manufacturing activities and industrial growth is expected to trigger higher usage of flooring compounds. Companies should look to develop application based products.

Brand building will prove to be the most fruitful exercise for the companies. Demand for user and application friendly products will grow faster than traditional products while value added products will be a focus area for sustained growth. Selective acquisitions and mergers and industry consolidation will enhance product portfolio and expanding market reach of companies.

This study was taken up on the highly relevant background of high prospective growth of the Construction Chemical industry in India

 Building Thermal Insulation Market

The Building Thermal Insulation Market research report covers the major building insulation markets; their geographical trends and forecasts. The global market is divided into insulation materials which include wool insulation, plastic foams, and other insulation materials such as wood fiber, perlite, etc. The report studies these materials with respect to the key players, products, and geography trends of these markets. The market is further studied from the application’s perspective. The major on goings in the global building insulation industry such as winning imperatives of market players and major burning issues are also analyzed.

The insulation materials have gained popularity due to the fact that they help in energy saving while reducing the greenhouse emissions. This has resulted in increased applications of insulation materials in commercial and residential buildings. Consequently, it becomes important to study this market with respect to its segments, opportunities, and growth prospective.

The regulatory authorities have also supported the adoption of insulation materials by setting legislations which promote zero energy buildings. The regulations are active in the developed regions of Europe and U.S. and are also beginning to cover the emerging economies in Asia as well.

The report on building insulation market covers major drivers, restraints, and opportunities for global market and analyze them with respect to their order of impact which explains the weightage of a specific market factor. It also gives an elaborative description of value chain for market starting from the raw materials used for the materials to the major end-users of the products.

The market study analyzes the key materials with respect to major geographies which include North America, Europe, Asia, and ROW. This evaluates the insulation products such as glasswool, rockwool, EPS, and XPS in different geographies as the market split and usage of these products differ in different geographical regions. For an instance, the Asian market is the major user of plastic foam insulation products while U.S. and European markets are the major users of rockwool and glasswool for building insulation. Studying these products with respect to major continents is important to develop a holistic picture of the global market.

The report provides the study of building insulation market players/manufacturers for the proper understanding of the competitive landscape for the market. The report studies different market players with respect to the products they offer.

The report also provides market numbers for key insulating products which include market size for micro and macro market segments. It analyzes the growth rates of insulation products for parent and sub-segments. This gives a comparative picture about the increasing, stagnant or decreasing market for individual segment. It also studies the market with respect to three basic applications including wall insulation, roof insulation, and floor insulation. This gives a view of the dominating application market in which the insulation materials are used primarily.

The report has taken into account the key competitive developments that have taken place for the insulation companies. The major competitive developments in which these companies are involved are acquisitions, new products launch, and agreements and collaborations.

Finally, the report also profiles the major players with respect to their business, products, developments, financials, strategies, and other company-specific information. This gives a brief idea about the areas in which company is progressing.

McGraw-Hill Construction's latest SmartMarket Report

 

As sustainability and energy efficiency initiatives take hold around the world, firms are finding business value and opportunities from green building, including the opportunity for new environmentally responsible products, according to McGraw-Hill Construction's latest SmartMarket Report, "World Green Building Trends - Business Benefits Driving New and Retrofit Market Opportunities in Over 60 Countries," released today. The report, developed in partnership with United Technologies Corp. (UTC), is based on a study of global green building trends and aims to discern drivers of the green building marketplace.

According to the study, firms are shifting their business toward green building, with 51 percent of respondents planning more than 60 percent of their work to be green by 2015. This is a significant increase from the 28 percent that said the same for their work in 2013 and double the 13 percent in 2008.

This growth is not a trend localized to one country or region. From 2012 to 2015, the number of firms anticipating that more than 60 percent of their work will be green:

·   More than triples in South Africa;

·   More than doubles in Germany, Norway and Brazil;

·   Grows between 33 and 68 percent in the United States, Singapore, the United Kingdom, the United Arab Emirates and Australia.

"This report confirms that the green building movement has shifted from 'push' to 'pull'—with markets increasingly demanding no less than green buildings," said John Mandyck, chief sustainability officer, UTC Climate, Controls & Security. "By promoting greater efficiencies for energy and water, green buildings lower building costs while conserving the earth's precious resources. This powerful combination of built-in payback with environmental stewardship creates a new value proposition that is accelerating green building in all regions of the globe."

The key driver to going green, according to the survey, is that now green building is a business imperative around the world. In the 2008 report, McGraw-Hill Construction found that the top driver for green building was "doing the right thing." However in 2012, business drivers such as client and market demand are the key factors influencing the market.

"The acceleration of the green building marketplace around the world is creating markets for green building products and technologies, which in turn will lead to faster growth of green building," said Harvey Bernstein, vice president of Industry Insights and Alliances at McGraw-Hill Construction. "And the fact that green is growing in all parts of the world indicates that there are market opportunities in both established markets as well as developing countries."
These opportunities are mapping against expected benefits:

·   76 percent report that green building lowers operating costs

·   More than one third point to higher building values (38 percent), quality assurance (38 percent), and future-proofing assets (i.e., protecting against future demands) (36 percent)

Global industry professionals have high expectations of the operating cost benefits of green building—19 percent believe their operating costs will decrease by 15 percent or more over the next year (51 percent believe there will be increases of 6 percent or more), and 39 percent believe they will see savings of 15 percent or more over the next five years (67 percent expect savings of 6 percent or more).

In 2012, 89 percent of global industry professionals report using or specifying a green building product, and even more—91 percent—expect to do so by 2017. The most significant green building product opportunities are in the categories of electrical, mechanical, and thermal and moisture protection with at least 60 percent of survey respondents stating that they had installed or specified products in these categories in 2012, with a slightly higher percentage expecting to do so by 2017.

Given its importance, measuring lower operating costs is also the most used metric to evaluate green building performance—reported by 52 percent. These benefits are particularly important given that they can offset the higher initial costs that 76 percent of the industry report as the biggest challenge to building green.

The findings published in the report are drawn from a McGraw-Hill Construction survey of firms across 62 countries around the world. Firms include architects, engineers, contractors, consultants and building owners. The sample was drawn from firm members of the World Green Building Council in 62 countries, other global industry associations, and the ENR Top Lists. Of the respondents, 92 percent are members of Green Building Councils around the world. The results include a feature of nine countries with sufficient sample for statistical analysis. The study expands and contrasts against McGraw-Hill Construction's 2008 Global Green SmartMarket Report study. Given the survey sample source, McGraw-Hill Construction compared the sample against a non-GBC member audience, which was comparable in terms of involvement in green and planned activity. Further, the U.S. sample was consistent with McGraw-Hill Construction's extensive analysis of the U.S. construction market through its Dodge project data.

The study was produced in partnership with United Technologies with support from the World Green Building Council and the U.S. Green Building Council. Other research association partners include the Chartered Institute of Buildings, International Federation of Consulting Engineers (Fédération Internationale Des Ingénieurs-Conseils), Association for Consultancy and Engineering, Conseil International du Bâtiment (International Council for Building), Architect's Council of Europe, and the Royal Institution of Chartered Surveyors. A separate survey of global manufacturing firms was also conducted.

The built environment has a great impact on the natural environment, human health, and the economy. According to the Environmental Protection Agency, buildings in the U.S. account for:

·   36% of the nation’s total energy use

·   12% of its total water consumption

·   65% of total electricity consumption

·   30% of the carbon dioxide emissions

In addition, a growing body of research has established the connection between indoor air quality (IAQ) and the health of building occupants. While most of the problems associated with poor IAQ are the result of inadequate ventilation, some are also caused by various types of airborne contaminants or toxins. 

The presence of some of these contaminants, such as formaldehyde, is traceable to the use of certain building materials. Overexposure to formaldehyde may result in nose irritation, sneezing, dry throat, eye irritation, headache, and nausea. Formaldehyde is used extensively in the manufacture of certain building products (e.g., as bonding/laminating agents, adhesives, paper and textile products, and foam insulation) from which formaldehyde gas may be released in the course of normal use.

“Green” or “sustainable” building involves the use of building practices and materials that use resources as efficiently as possible, while constructing healthier, more energy-efficient, and environmentally friendly buildings. A related objective of some green building projects is creating esthetic harmony between a building and its environment.

The market for green building materials has been growing rapidly. As of the beginning of 2009, 284 million sq. ft. of buildings had been certified by the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) Program. An article in the June 2006 issue of Harvard Business Review predicts that green construction will become a mainstream technology in the next 5 years to 10 years, as a growing market helps to drive down the cost of green building products and building owners become increasingly aware of the economic, health, and environmental advantages of green building.   The impact of green building going mainstream will be as profound on commercial real estate as the invention of central air conditioning in the 1950s and 1960st or elevators in the 19th century, according to the article.

More than 500 U.S. companies, including a number of Fortune 500 companies, are involved in the production of green building materials and the design and construction of green buildings. This number is likely to grow rapidly as more building owners and investors wake up to the potential of green building.

The green building industry has not been immune to the recession that began in 2008. The market for all types of green building materials was down by nearly 40% in 2008 compared with 2009, reflecting the decline in construction activity. However, with housing and commercial construction set to begin a recovery in 2010 or 2011, the market for green building industry should experience above-average growth rates over the next 5 years due to suppressed demand. 

These trends provide an opportunity for both existing players and new entrants into the green building materials market. This BCC Research report analyzes these new developments and their potential impact on industry participants. 

Construction and building activities are rapidly transforming the face of the planet, bringing with them a much improved quality of life for their inhabitants.
The downside to frantic construction, which is increasingly becoming the order of the day, is that it brings in its wake a host of undesirable consequences for the environment, giving rise to the demand for cleaner, environmentally-sustainable construction techniques.
Since its introduction, the global green construction sector has been making progress in leaps and bounds.

The concept of environment-friendly buildings, or green buildings as they are popularly known, is catching on in India. While the green building movement has been around globally since the 1970s, it has gained momentum in India only in the last couple of years.

Green buildings are steadily increasing their footprint in India. According to Indian Green Building Council, from a mere 20,000 square feet in 2003, the green building footprint in India has now reached 1 billion square feet.

Today, India boasts of an impressive total of 1,300 registered green building projects with a built-up area of over 905 million square feet, which are being constructed all over India. Again, this is indicative of the tremendous growth that this sector is currently experiencing.

The first defining moment was when the CII-Sohrabji Godrej Green Business Centre in Hyderabad was awarded the prestigious LEED Platinum rating from the US Green Building Council. This has paved the way for the Green Building Movement in the country.

It is estimated that the market potential for green building products and technologies in India by 2015 is about $100 billion. Real estate developers are also increasingly turning to green building, egged by the ready availability of environment-friendly building materials such as AAC blocks, fibre-cement sandwich panels and plywood-substitute lightweight partition panels.

In India, these developers find it advantageous to position themselves as 'green developers' in the marketplace, as it allows them to charge a higher rate for such buildings besides providing an environment-friendly development to consumers. With more and more customers seeking green housing and ready to pay a premium for the same, green building is emerging as both a financially lucrative and environmentally-conscious way to operate.

The Government of India has been a keen observer of the effects of construction activities on the environment. The government is a key stakeholder in guiding and formulating green building policies in the country.

Among the measures the Government of India has initiated to promote green building is a directive that mandates all buildings constructed by the Central Government/PSUs to at least aim to achieve a three-star rating; this means that energy conservation will be the central focus in the planning, design and construction of such structures.

To promote the green building concept, Ministry of New and Renewable Energy (MNRE) in association with The Energy and Resources Institute (TERI) has developed the GRIHA rating system. CPWD, the largest construction department of the Government of India, has decided to have its future constructions GRIHA rated. (This system rates buildings on a 1-5 star scale, with 5 stars signifying the most energy-efficient green buildings.)

MNRE has also devised many attractive schemes to provide the much-needed impetus to the green building movement in the country. The ministry is encouraging urban local bodies to formulate green building promotion policies through discounts on premium and property taxes, by giving them a one-time grant of up to Rs 50 lakh. In doing so, MNRE hopes to facilitate the process of policy formulation and awareness building.

Such initiatives are only the beginning; infrastructure development is expected to grow multi-fold in the coming years. Green building concepts will ensure the efficient use of resources, including energy; lower the environmental impact of building and overcome the challenge of climate change. It is essential that we lay strong emphasis on adopting green initiatives in a big way, especially through the use of environment-friendly green building materials.

Buildings are major consumers of energy in their different phases-construction, operation and maintenance. Globally, about 40 percent of energy consumption is estimated to be in the building phase. Hence, green buildings initiatives are the need of the hour to effect a reduction in energy consumption. Building rating systems will also help to bring momentum in the race to achieve energy efficiency and sustainability in buildings.

The increasing market penetration of energy-efficient products and processes through the central government and industry associations, utility companies, regulatory commissions and energy service companies has helped to compile building codes and standards that are applicable at the local and national levels.

The revised National Building Code (NBC) 2005, in its latest version, provides guidance on aspects of energy conservation as well as sustainable development. NBC provides general guidance on potential energy-efficiency aspects of factors such as daylight integration, artificial lighting requirements, and heating, ventilating and air conditioning (HVAC) design standards. The BEE-developed Energy Conservation Building Code (ECBC) is currently a voluntary programme, with a number of states adopting it as a mandatory requirement.

The present-day construction industry faces multiple challenges. The lack of adequate labour (skilled and unskilled) is one such issue. Logistics have to be managed, so as to get the various building materials to the construction site.

There is also a lot of material wastage that is hard to manage on site. Pre-cast materials such as wall panels provide a good solution to tackle these challenges. With cement prices going up, the need of the hour is to use materials that call for a reduced mortar consumption.

The construction industry is now targeting a faster construction cycle and more effective reduction of wastes. To tackle these challenges, key players are now considering the use of pre-cast materials.

Governmental support too can come in the form of a favorable policy environment that provides substantive incentives for green development. International examples have proven that mandatory and uniformly implemented codes and standards are the only way to achieve a substantial impact for any green efficiency measures.

Indian companies should focus on green construction as it helps to reduce energy consumption as against conventional building materials.

A considerable amount of savings in cement and steel can be achieved using green building products and technologies. Water usage is greatly reduced and, for a country like India where water is a scarce resource, it helps in conservation.

Lesser use of earthen soil helps to minimize the threat of soil erosion. Due to non-toxicity of the raw material and lesser usage of sand and soil, green construction helps to check air pollution to a great extent. Intangible benefits include enhanced air quality, longer life, more safety for occupants, and the conservation of scarce natural resources.


The Report Copied From : Projects Monitor