Market Trends of India Wire And Cable Industry
Growing Demand for Housing Wire in India
- India's housing sector is witnessing a significant increase, propelled by swift urbanization, government policies, and an expanding middle class. With this growth, the demand for housing wire is continuously growing, as it is one of the most important elements in residential electrical setups. This demand directly results from several interlinked factors highlighting the dynamic changes occurring in India's housing and construction industries.
- India is also experiencing a significant trend toward urbanization. The Union Ministry of Housing and Urban Affairs forecasts that India's urban population will surge to 600 million by 2031. This demographic surge is fueling a heightened demand for new housing units, amplifying the need for housing wire. Specifically, 90 m housing wire, known for its adaptability and efficiency in residential setups, has become a staple in the electrical wiring of these new urban dwellings.
- Further, according to the World Bank, India's rising middle class, estimated to grow to 580 million by 2025, significantly contributes to the demand for housing. Higher disposable incomes are leading to an increased demand for quality housing. As per the report by CBRE Group, in 2023, the sales of mid-end houses were the highest at 46%, followed by high-end houses and affordable houses at 27% and 16%, respectively. Such growing real estate sales drive the market for high-quality electrical components.
- Further, companies such as Havels, Polycab, and Anchor are continuously working toward advancements in their electrical wiring segment to provide efficiency and safety of the housing wire. Also, fire-resistant and low-smoke wire innovations are increasingly adopted in Indian houses. Additionally, the development of smart homes, which require robust and reliable wiring systems, further bolsters the demand for high-quality housing wires.
- Also, infrastructure development in Tier-II and Tier-III cities is increasing demand. As these cities grow and upgrade, the need for new residential complexes is surging. This, in turn, is fueling a demand for extensive electrical wiring.
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Increasing Use of Wire and Cables in the IT and Telecommunication Segment in India
- India's IT and telecom segment has witnessed a surge in the demand for wires and cables, mainly driven by various factors, including expanding broadband services, the proliferation of smart devices, the implementation of 5G technology, and government initiatives like Digital India. These elements have created a growing demand for wires and cables.
- Further, India has seen an increase in broadband penetration over the last decade. According to the Telecom Regulatory Authority of India (TRAI), the country’s broadband subscriber base has grown extensively. For instance, the telecom subscriber rate reached 102.4 million in Uttar Pradesh, followed by Maharastra, Bihar, and Andhra Pradesh with 94.94 million, 94.90 million, and 86.46 million in 2023. This surge is largely due to the rising demand for high-speed internet connections. As the subscriber bases increase, many telecom companies in India have rolled out fiber optic cables.
- For instance, in January 2024, BSNL announced its plan to upgrade its copper network to optical fiber in Ernakulam in the last quarter of 2024 to provide high-speed internet. As a part of this initiative, the company aims to upgrade 1.2 lakh copper connections to fiber cables in Tamil Nadu. Such initiatives by the telecom companies have boosted the demand for cables, driving the growth of cable in the telecom industry.
- Moreover, the proliferation of data centers in India has been a major catalyst in driving the demand for wires and cables. Many IT and telecom companies operating in India are opening new data centers. For instance, in January 2024, a joint venture of Digital Realty Trust, Reliance Industries, and Brookfield Infrastructure Partners announced the launch of a 20 MW greenfield data center, MAA10, in Chennai. Such data centers require many cables, including high-speed fiber optic cables, to ensure efficient and uninterrupted data transmission.
