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Performance of Indian machine tool industry

High growth momentum

The financial year 2007-08 was yet another landmark one for the Indian economy and

the industry, generating a great deal of optimistic growth and promising outcome.The year was marked by 9 per cent plus GDP growth earning the accolade of beingone amongst the fastest growing countries in the world.

The surge in demand was rampant across Indian industries, especially in theengineering and the manufacturing sector. The key aspect about manufacturingindustrys performance was its efforts to achieve excellence in quality, design andinnovation. The country also posted optimistic results in agriculture and in theservices stream.

For the Indian machine tool industry, 2007 was a year on the decline, and is expectedto result in reduced orders from the Indian and overseas markets. Metalworkingmachine tool output of the Indian industry worth Rs 17,525 million, registered agrowth of 5 per cent during January December 2007. Much of the growth in Indiasmetalworking machine tools came about because of enhanced requirements from theautomotive sector auto ancillary industry, defence, railways, job shops and small-scaleindustry units.

Metal-cutting & metal-forming toolsMetal-cutting segment continued to account for 88 per cent of the total output ofmachine tools in India. In 2007, metal-cutting machine tool output worth Rs 15,357

million, led to a growth of 4 per cent.

Turning centres recorded the largest production in the industry during January December 2007, with a share of 30 per cent in the total machine tool output. Turningcentres, together with machining & grinding centres, accounted for nearly three-quarters of the total metal-cutting produce and about two-third of the total metal

working output in 2007 calendar year.

Indian manufacturers in the metal-forming segment, on the other hand, registered agrowth of 8 per cent, with an output valuing Rs 2,168 million. Press manufacturers

witnessed the largest volume of business in this segment, with a 60 percent share inmetal-forming machine tools.

CNC & conventional machine toolsIn keeping with the focus of the Indian industry towards enabling manufacturingexcellence, CNC machine tools comprised bulk of the produce from the Indianstable. This segment had over 70 per cent share in the total metalworking machinetool output in 2007.

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CNC machine tool segment in India clocked a marginal growth of 5 per cent with aturnover of Rs 12,145 million. CNC turning centres. Together with machining andCNC grinding centres, held a share as high as 80 per cent in the total CNC machinetool produce and 55 per cent share in the metalworking output in 2007. These three

segments have been leading the pack for over half a decade.

Conventional machine tool manufacturers, likewise, registered a growth of 4 per centto an output valuing Rs 5,380 million.

Export scenario The focus of Indian manufacturers to expand their potential to other frontiersresulted in tapping new opportunities in overseas markets, albeit marginally. As aresult, exports increased by 98 per cent in 2007. A total of 395 machine tools worthRs 1,475 million were exported by the Indian industry during January December

2007. Indian manufacturers exported to 36 countries, including prominent ones suchas Italy, Canada, Germany and the U S.

The highlight of the machine tool exports in 2007 was the performance in the CNCsegment CNC machines registered a growth of 100 per cent over the previouscalendar year.

Machining centres followed by turning centres, electro-discharge machines andpresses witnessed the highest export orders.

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Import trend A burgeoning Indian market and a capacity-constrained Indian machine toolsindustry resulted in a zoom-phase for importers. Machine tool imports rose by 47 per

cent to register a total value of Rs 55,640 million. With this hike, imports captured 75per cent of the Indian marketshare.

The bulk of the imports comprised metal-cutting machine tools. And within thissegment machining centres, turning centres and grinding centres formed the largestchunk of imports. These three machine categories captured 40 per cent of the totalmachine tool imports in 2007.

(Value in Rs million)Key figures of Indian machine tool industry

Years IndicatorsProduction Exports

2002 4,817 4852003 5,178 4782004 10,111 4912005 12,556 5162006 16,796 7462007 17,525 1474

One US Dollar = Rs 43.72 approximatelyOne Euro = Rs 64.68 approximately

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Production and export of metalworking machine tools in 2007

Machine Type Production Export

Qty Value Qty Value

Metal-cutting machine toolsEDMs (Total) 604 640.00 72 74.50

(CNC) 407 567.56 72 74.50Machining Centres -Hor. 94 790.96 0 0.00

-Ver. 1,495 3,812.46 43 105.26-Oth. 0 0.00 0 0.00

Lathes & automats (Total) 3,218 5,109.96 135 626.49(CNC) 2,911 4,901.70 124 281.41

Boring-milling machines (Total) 52 359.17 0 0.69(CNC) 1 7.50 0 0.00

Milling machines (Total) 415 383.72 10 93.60(CNC) 66 84.02 0 0.00

Drilling machines (Total) 510 656.07 60 82.32(CNC) 37 242.10 1 0.65

Threading/tapping machines 0 0.00 0Grinding machines (Total) 694 1,213.00 39 48.56

(CNC) 139 641.37 6 17.38Honing, polishing & othersuper-finishing machines

214 499.71 6 7.16

Planing, shaping, slotting &

broaching machines

28 45.15 2 5.05

Gear-cutting machines 112 580.13(CNC) 3 30.38 0 0.00

SPMs (Total) 185 1,218.20 2 7.34(CNC) 97 626.38 0 0.00

Other metal-cutting machines 73 48.90 3 12.70

Total metal-cutting machinetools

(Total) 7,694 15,357.00 372 1,063.66

(CNC) 5.250 11,704.00 246 479.25

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Production and export of metalworking machine tools in 2007Machine Type Production Export Export

Qty Value Qty Value

Metal-forming machine tools

Bending, folding, straighteningflattening machines (includingpress brakes)

(Total) 161 342.46 7 55.89(CNC) 130 257.38 1 1.37

Punching and / or shearingmachines

(Total) 152 201.61 3 12.95(CNC) 135 184.00 1 3.78

Presses 238 1,502.00 8 324.00

Die-casting machines 14 38.47Other metal-forming machines 28 83.37 5 18.05

Total metal-forming machinetools

(Total) 593 2,167.91 23 410.90(CNC) 265 441.38 2 5.15

Total metalworking machinetools

(Total) 8,287 17,525.48 395 1,474.56(CNC) 5.515 12,145.51 248 484.40

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Import of machine tools during January-December

2007 2008

Description Qty Val Qty ValMetal-cutting machine toolsEDMs (Total) 280 559.0 293 707.0

(CNC) 206 516.0 210 679.3Machining Centres -Hor. 555 6759.0 499 4184.3

-Ver. 1245 3874.0 1129 3500.2-Oth. 82 2126.0 17 294.0

Lathes & automats (Total) 3376 5846.0 3012 4222.9(CNC) 1419 4648.0 1260 3318.9

Boring & boring-milling machines (Total) 1,058 2826.0 1,081 1387.9

Milling M/cs (Total) 4020 2561.0 3503 1558.0(CNC) 305 1773.0 320 943.7

Drilling machines (Total) 1558 835.0 1139 620.0(CNC) 126 514.0 147 281.9

Threading / tapping machines (Total) 693 243.0 322 171.8Grinding machines (Total) 2448 5771.0 2416 3711.5Honing, polishing & other super-finishing machines

(Total) 491 622.0 529 721.3

Planing, shaping, slotting &broaching machines

(Total) 216 685.0 119 209.8

Sawing/cutting machines (Total) 754 350.0 544 301.0Gear-cutting machines (Total) 1049 3019.0 958 1784.1Other metal-cutting machines 1,154 8273.0 4489 4473.0

Total metal-cutting machine tools 18979 39976.0 20,050 27846.8Metal-forming machine toolsBending, folding, straighteningmachines

(Total) 663 1789.0 560 1218.7

Power presses (Total) 1705 5677.0 1136 3832.5Punching and/or shearingmachines

(Total) 695 2230.0 561 1340.1

Other metal-forming machines 1,950 5968.0 1,460 3697.9Total metal-forming machinetools

5,013 15664.0 3,717 10089.2

Total metal-forming machinetools

23,992 55640.0 23,767 37936.0