NEW DELHI: As India is expected to become the third-largest automotive market soon, the auto components industry in the past few days have witnessed a considerable jump in the overall business, mainly in the investor sentiment.
Market insiders are of the opinion that the positive investment sentiment is one of the possible reasons for the positive growth in auto component businesses across India. According to IndiaMART IKS survey, 63.6% auto component SMEs clocked jump in sales and 64.2% saw rise in output capacity during 2011. The survey was carried out by IndiaMART to unravel the market trends and sentiments of SMEs players engaged in the auto component sector.
As the global meltdown is taking a toll on the productivity of different sectors in a big way, the auto component sector is marching towards putting up robust performance. The sector is witnessing strong demand and investments are pouring in every possible sphere.
While talking to SME News about the possible investment avenues present in Indian auto components sector, Mohit Mehta, manager of Conveyor Koncepts, said, “As the demand has gone up considerably in auto component sector, the investments are pouring in. The economic slowdown had hit the industry, but now it is out of the clutches of the crisis. In the future, it is expected to post good growth.”
Moreover, the Society of Indian Automobile Manufacturers a(SIAM) has stated that the output of passenger vehicles in India in 2020-21 is projected at 9.7 million units, a compounded annual growth rate of 13%.
With the rise in demand for cars in India, SMEs in the auto component sector are positive that in the coming days they will receive investments from private equity funds and also venture capitals.
Pratiek, propetier of Ecko Enterprises & Nepra Industries, said, “The SMEs will receive investments from PE funds, VCs with the rise in demand. I have positive outlook for the sector.”
As the overall growth prospects for auto component SMES is good, the sector will post good results in the coming months as well.