Monthly Report – December 2016

Welders
Demand drivers growth hit historic lows - future growth
dependent on uptick in infra, real estate and auto sectors
Automotive Real estate Infrastructure
• Automotive sales de-grew ~ 19% for
Dec'16 – highest in last 16 years
• With rural demand drying up, 2W
faced the brunt of de-monetization -
sales fall by 22%
• PV and CV saw sales declining by -
1% and -5% respectively
• Players cut down production to adapt
to the falling sales – production fell
by 22%
• Industry awaiting budgetary
proposals to boost consumer
demand
• De-monetisation adversely effected
the residential real estate market
• New launches and sales fell in 15% -
80% range for Q4CY2016 across
Tier 1 cities
• Commercial space remains stable
with improving vacancy levels
• PM announced interest subvention of
3% - 4% for low income housing
• SBI, HDFC and ICICI cut base rates
by 50-90 bps and other banks are
following suit
• Industry hopeful of renewed demand
on back of falling interest rates and
govt's push on housing
• $10 billion to be spent over next five
years for developing airport
infrastructure
• Infrastructure output growth
decelerated to 4.9% for Nov'16
following 6.6% growth in Oct'16
• Infrastructure credit deployment
declined to 8% for Nov'16
• Railways spent Rs 12,000 crs during
the year on new lines - going slow
on further investments due to fund
constraints and mounting loses
• Road laying not picking up with
highway construction pace at
513km/month for 7MFY2017 against
FY2016's 502km/month
• Private investment in infrastructure to
be limited - govt. spend needed for
rejuvenating infra space
Source: Infrastructureindia.gov.in, SIAM, press runs, analyst reports
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