The power sector looking at investments worth Rs.15,000 lakh crore over the next five years, and cables and wires - which are the main ingredient to enable this development - will witness a huge growth trajectory.
Wires are materials used to conduct power from the point where it is generated to the point where it is used. Copper or aluminum wires without insulation are usually used for grounding connection and also for high tension or high voltage transmission lines; while nichrome wire, constantan, manganin, and German silver wires are used as resistance wires in electrical equipment and appliances.
All wires have resistances that oppose the unlimited flow of current and causes voltage drop resulting in the eventual heat developed in the wire. The heat developed varies according to the square of the current in amperes. There is a limit to the degree of heat that various types of wire insulation and sizes can safely withstand. They should not be allowed to reach a temperature that might cause a fire. Thus, wires and cables form an important aspect of the power sector in terms of utility and safety.
India has the fifth largest power generation capacity in the world and the government has ambitious plans for infrastructure development. In the power sector, cables and wires are a must and with the Ministry of Power (MoP) looking at an investment of Rs.15,000 lakh crore over the next five years, the sector will witness a huge growth trajectory.
Says Amit Jain, Managing Director, CMI Limited, ´In all the outlays and announcements by the government (smart cities, highway projects, digital India, power sector), there is expected to be a major demand hike for wires and cables. We are already geared up and have increased our capacities substantially to meet with these increased demands. We expect that the power industry´s share of our revenues will rise up to around 20 per cent and the real numbers will possibly double with the increased demand.´
Adds Manish Goel, Managing Director, Shilpi Cable Technologies Limited, ´The MoP´s plans for investting Rs.15,000 lakh crore over the next five years. This is a huge opportunity for a company like ours and we are well positioned to take advantage of the demand. The future looks bright if these proposed plans take shape. Moreover, new technologies and extensive R&D by key players is making it possible to collect more information in order to fully understand the market demand.´
The Government of India (GoI) is also aiming to increase share of clean energy through renewables. The target of 20 GW of solar power proposed to be installed in the country has been reset by GoI, to achieve five times more, at 100 GW of solar power by 2022.
Talking about the impact of the increased renewable targets, Jain feels, ´With such ambitious plans, huge outlay and given the investment figures we are talking about, there is expected to be a major demand hike for wires and cables. While we do not have much traction in the renewables as of now, with the focus in policy for this segment and witnessing the increasing demand in the segment, we are looking at this market closely.´
It is said that the sector will see investment ranging near Rs.65 lakh crore by 2030, including around 40 per cent in power gear through domestic manufacturing. This is a huge figure and possibly points to the explosive growth in the sector.
Adds Goel, ´Future growth in this market is looks very positive, as we see growth in the infrastructure sector of the country. India´s current power deficit and focus on renewables will be the biggest driver. SCTL is ready and prepared to be part of the Make in India initiatives.´
The wires and cables market in India has come a long way, from being a small industry to a very large one, over the past decade. The industry is mostly volume driven, although it comes with a lot of technical and quality nuances. Over the last 20 years, the industry has shifted from being an unorganised sector to an organised one, although 35 per cent of the industry continues to be a part of the unorganised sector. Points out Goel, ´The market has been growing steadily, and according to Netscribes, it is expected to touch `572 billion by 2018. With the industry growing at a CAGR of 15 per cent as a result of growth in the power and infrastructure segments, the present and the future of the sector looks promising.´
The wires and cables market in India has been characterised by a steady growth in demand with slight fluctuations, affected by economic turbulences. The industry is highly competitive, with a major proportion of the market being captured by few organised players.
Jain concurs that the unorganised sector is no major threat when it comes to quality for price. ´Though the unorganised sector is only limited to home and commercial segments, they have around 35 per cent market share and it is here that the issues of quality and pricing come into play. In the unorganised sector, unfortunately cost is the main consideration rather than quality and certifications,´ he states.
In the home and commercial segment, players suffer from a double whammy - it is not just the unorganised sector but also sub-standard Chinese imports that cause trouble and give the industry a bad reputation. But the industry is now gearing to take up the challenge head-on and is creating awareness about the need for certifications, besides educating influencers in the category.
Trends & Technology
New product design and development is a crucial factor for the survival of a company. In an industry that is changing fast, firms must continually revise their design and range of products. This is necessary due to continuous technology change, development, competition and the changing preference of customers.
´Currently, we are aggressively working on introduction of new products. We are planning to expand and also introduce new products in our basket. Our culture of continuous improvement and technical innovation, helps us create lasting relationships in the industry and enhance our portfolio in the Indian, other Asian and African markets,´ Goel shares.
Safety & Regulation
Compliance with standards include companies adopting the ISI certification marks to ensure quality of cables as per British Standards Institution (BSI). Adds Jain,´We are proud that due to our zero tolerance policy and strict inspection dispatch, we have never been rejected by customers for deficiency in any parameters´
As per the National Crime Records Bureau´s report 2014, 11,000 people died in 2014, either due to electrocution and/or fire due to electrical short circuits. Electric defaults have been seen as the largest single reason for cause of building fires. GoI has accorded high importance to this area. Unfortunately, poor practices, improper and weak installations, undersized and inferior quality of wires in the buildings have resulted in an increasing number of electrical accidents.
Wires and cables are integral components of the electrical and power, infrastructure, real estate and IT industries. For safety and reliability of electricity of users, the regulation standards are IS:694:2010. For fire safety in buildings, wire and cables are manufactured with flame self extinguishing property and to prevent short circuit due to insulation if cut by rat, it is anti-rodent.
Commenting on the safety and regulations for wires and cables, Amol Kalsekar - Chief Manager Building Construction, ICA India states, ´Copper is a vital element for wires and thus, the quality of copper plays a very important role in wires. Poor quality of copper used in the wire may result in safety hazard as well as energy loss.´
Thus periodic inspection and following right wiring practices is essential for electrical consultants, contractors and electricians. ´We encourage the electrical fraternity to adhere to the National Electrical Code and the National Building Code and use minimum 1.5 sq. mm copper wire as the minimum cross section for the light load depending on the appliance to be used for efficient use of electricity and ensuring safety,´ Kalsekar states.