Domestic tool room and mould base demand trend

 

 

6-7% CAGR (10)- (8) % 4-6% CAGR 185-190
ee 150155 >
147 .
130-135
FY17 FY19E FY20E FY21P FY24P

Note: Includes tools, moulds, dies and fixtures
Source: CRISIL Research

Industry structure

As per the Tool and Gauge Manufacturers Association, there are more than 1,000 players in the tool room industry,
of which ~85% are small and unorganised.

The tooling requirement is met through three sources — (i) captive tool room, (ii) commercial tool room, and (iii)
imports. Many large manufacturing units have in-house tool room departments. Also, auto component and original
equipment manufacturers mostly have captive tool rooms, and account for 5% share of the industry units.
Commercial tool rooms (CTRs) are independent units that cater to the tool room requirement of several industries.
These players account for 50% of the units in the industry, and are mostly small to medium in size; there are
nearly 100 CTR medium-scale manufacturers. The Indian CTR industry is concentrated in Mumbai, Bengaluru,
Chennai, Hyderabad, Pune, and the National Capital Region, owing to the presence of industries such as
automobiles, auto components, plastics, and general engineering.

Nearly 45-50% of the tooling demand is met via CTR, while 30-35% tooling is done in captive units. The rest 15-
20% is met via imports.

Major growth drivers

Automobile sector

Growth drivers for the automobile industry are covered in ‘Market size of the Indian automobile sector’ chapter
under ‘Demand drivers for the automobile sector’ section.

 

 

 

 

Total sales volume (million units) TXT oy
Automobile segments FY20 Zi z FY20-FY24P
‘Commercial vehicles 0.72 0.54 0.9 5-7%
Passenger vehicles 35 [2.9 4.2 4-6%
‘Two-wheelers 20.9 [176 22.7 |1-3%

Tractors 0.78 (0.89 0.95 4-6%

 

 

 

 

 

Note: Total sales include domestic sales and exports
Source: Society of Indian Automobile Manufacturers, CRISIL Research

Plastic processing and products

Small and medium enterprises have a large presence in the processing industry, owing to its commoditized nature,
low entry barriers, adequate availability of raw material, and low capital intensity. Hence, the segment is highly
fragmented. There are ~30,000 registered plastic processing units, of which ~75% are in the small-scale sector.

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