Analysis of the mining equipment rental market in India
The relevance of research
The operation of special equipment on a rental basis seems to be the most convenient and less costly way for companies to cover the need for mechanized equipment of production processes. Hiring dump trucks and other specialized vehicles frees contractors from the maintenance and storage of a fleet, as well as from the costs associated with their ownership. The statistics of the retail of special equipment shows that more than half of the machines and equipment are immediately purchased with the expectation of leasing. At the moment, the Indian mining equipment rental market is far from being saturated.
Purpose of the study
Analysis of the state of the quarry equipment rental market, assessment of the market volume, analysis of competitors, consumers, as well as identification of factors affecting the quarry equipment rental market and analysis of the investment attractiveness of the market.
Content
Part 1. Overview of the mining equipment rental market in India
1.1 Main characteristics of the market
1.2 Evaluation of factors affecting the market
1.3 Dynamics of the volume and capacity of the mining equipment rental services market in 2013-2017
1.4 Analysis of supply and demand in the market
1.5 Market structure
Part 2: Competitor Analysis
2.1 Major players in the market, their profiles (region, revenue, vehicle fleet)
2.2 Market shares of the largest competitors
Part 3. Consumption analysis
3.1 Characteristics of consumer behavior
3.2 Analysis of consumer preferences
3.3 Market structure by sectors of consumption
Part 4. Price analysis of competing companies
4.1 Rental rates for various mining machinery and equipment
4.2 Lease payment structure
Part 5. Consumption forecast until 2022
6 Recommendations and conclusions
6.1 Assessment of factors of investment attractiveness of the market
6.2 Barriers and risks to market entry
6.3 Conditions for achieving business efficiency in the special equipment rental segment
Research excerpt
Part 1. Overview of the mining equipment rental market in India
1.1 Main characteristics of the market
Quarry equipment - equipment designed to work in quarries.
Quarry - a set of mine workings formed during the extraction of minerals in an open way; open pit mining enterprise.
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In India, the following brands of mining equipment are most popular:
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Rent of mining equipment is one of the forms of using equipment for the needs of the mining industry, which provides for the targeted or seasonal use of equipment by economic states without purchasing it. However, after the expiration of the life of the equipment, it can be bought out by the primary cooperative. The use of leased machinery and equipment, as well as their technical condition, is controlled by the relevant divisions of the lessor enterprise.
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General state of the market
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An example of an ideal ratio of procurement volumes for contractors to profitability remains .... With a ratio of ...%, income from hiring in average annual terms is ... billions of dollars. ... The Indian market of the leased vehicle fleet remains .... With a ratio of less than ...%, the industry's profit for the year does not exceed ... million in dollar terms.
Thus, the following can be distinguished as the main characteristics of the quarry equipment rental market:
...
The quarry equipment rental market is an organic part ... in particular, and of the entire economy as a whole. Accordingly, it is possible to determine the following factors of mutual influence of segments of the economy from the point of view of the rental equipment market (Diagram 1).
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1.2 Evaluation of factors affecting the market
An analysis of the state and current market trends makes it possible to single out key groups of factors influencing the market: social, sectoral, political, legal, and technological factors.
Macroeconomic factors
The growth rate of India's GDP (gross domestic product at market prices in accordance with the 2008 SNA methodology, at constant 2011 prices) during 2011-2015 decreased from 104,3% to 97,2%.
In 2016, the Indian economy showed signs of recovery (the decline in GDP slowed down, the growth rate amounted to ...%), in 2017 the indicator increased by ...%, in the 2nd quarter of 2018, the GDP growth rate increased to ...% by compared to the previous year.
...
In general, the impact of macro factors on the quarry equipment rental market in India is currently assessed by GidMarket as .... This is facilitated by ...
1.3 Dynamics of the volume and capacity of the mining equipment rental services market in 2013-2017
Companies providing services for the rental of mining equipment indicate the following activities in the charter:
...
According to ... the volume of the market for renting construction machinery and equipment without an operator for the period 2013-2017 peaked in 2014 - ... billion Rs., in 2015 there was a significant decline - to ... billion Rs. By 2017, the market has grown to ... billion Rs. It is noteworthy that the rental of construction machinery and equipment with an operator did not experience such significant fluctuations, in general, the market volume in this segment grew from ... billion Rs. in 2013 to ... billion Rs. in 2017.
...
According to GidMarket analysts, the volume of the quarry equipment rental market for the period 2013-2017. reached its maximum in 2014 - ... billion Rs., in 2015 the market volume decreased significantly - to ... billion Rs., by 2017 the market grew to ... billion Rs. According to the forecast for 2018 (based on information for 9 months, the market will increase to ... billion Rs.
Diagram 16. Dynamics of the quarry equipment rental market in India in 2013-2017
Market dynamics are influenced by the following factors: ...
To assess the market capacity, let's consider the development trends of the special equipment rental market in general and quarry equipment in particular.
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1.4 Analysis of supply and demand in the market
Demand
Demand in the quarry equipment rental market in India depends primarily on successive groups of factors:
Changes in the economy have an impact on the dynamics of the mining industry: ...
...
The dynamics of demand for the rental of special equipment in general and mining equipment in particular is evidenced by the dynamics of query statistics in the Yandex search engine.
The number of requests for the combination of the words ""quarry equipment rental"" in January-November 2018 reached ..., which is ...% higher than the figure of the previous year. For the query “rent of special equipment, the number of requests in January-November amounted to ..., which is ...% higher than the figure of the previous year. The number of requests for keywords “stripping works” in January-November 2018 amounted to ..., which is ...% higher than in 2017.
Table 7. Dynamics of the number of requests in the Yandex search engine for the rental of special equipment and mining equipment in January-November 20117-2018
The decrease in the number of requests for the rental of certain types of mining equipment is associated with the fact that ...
...
Proposal
The analysis allows us to identify the following key characteristics of the offer in the market for renting quarry equipment:
Significant differences in the offer depending on the region:
...
Thus, the discrepancy between supply and demand remains: the demand for the rental of mining equipment ..., both in connection with ... and ... .
...
1.5 Market structure
This section examines the supply structure in the mining equipment rental market as of October 2018.
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Market structure by type of equipment
In the mining equipment rental segment, the leaders are dump trucks (rigid with a share of ...% and articulated ...%). The second place in popularity is occupied by screens: in the total mass of proposals, they own almost ...%. Mining excavators and drilling rigs (...%).
Diagram 18. The structure of the mining equipment rental market by type of equipment in 2017
Market structure by year of issue
The vast majority of vehicles are offered in ... years, of which mining dump trucks produced in the indicated period belong to ...%. As for mining excavators, the offers here were extremely limited: only equipment of ... year of manufacture was available for rent.
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Market structure by tonnage
The market structure by tonnage is considered only in the segment of mining shovels. As of October 2018, excavators ... tons accounted for ...% of the total supply, ... tons - ...%.
...
Market structure by country of equipment production
Speaking about the regions of production of quarry equipment, we note that India was represented only in one case: in most ads, KAMAZ dump trucks were offered for rent.
...
Market structure by brands
Dump trucks
In terms of specific brands, the leadership belongs to domestic mining dump trucks: the share of ads with offers to rent KAMAZ trucks amounted to more than ...%, Shaanxi/Shacman equipment is in second place. In general, we note that the range of offered machines was quite diverse both in terms of brands and models, and in terms of carrying capacity.
...
Excavators
In the segment of mining excavators, manufacturers from Japan, Europe, and India are represented. Komatsu became the leader: the brand owns more than ...% in the total mass of rental offers. In second place - domestic ECG.
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Screens
Of the five brands offered for rent in 2018, more than ...% of the total amount was for screens manufactured by Kleemann. Along with European equipment, it was possible to rent screening equipment of American or, for example, domestic production: Montec screens were offered for rent in ...% of cases.
...
Thus, in 2018, the structure of the market (supply) for the rental of mining equipment is dominated by dump trucks ... of the year of manufacture with a carrying capacity of ... tons.
Part 2: Competitor Analysis
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An analysis of mining equipment rental proposals allows us to conclude that the main part of the market belongs to ... companies that have a fleet of equipment and offer unused equipment for rent (...% of the total number of proposals), specialized companies account for ...% of the total number of offers.
...
It should be noted that the largest companies providing mining equipment rental services most often provide a wide range of equipment (road, construction, mining). The characteristics of the companies (see below) are presented in terms of renting mining equipment.
2.1 Major players in the market, their profiles (region, revenue, vehicle fleet)
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2.2 Market shares of the largest competitors
The analysis carried out allows us to draw the following conclusions: there are several major players on the quarry equipment rental market, which are the official representatives of the leaders in the production of quarry equipment (...), located both in the European and in the eastern part of the country.
...
Diagram 26. Shares of the largest competitors in the Indian quarry equipment rental market
Part 3. Consumption analysis
3.1 Characteristics of consumer behavior
To assess consumer behavior in the mining equipment rental market, the following parameters were selected:
The ratio of owned, rented and used equipment.
Reason for using rental equipment.
The reason for renting equipment with an operator / without an operator.
Principles for choosing a rental company.
The assessment was made based on the results of a survey (...) of 450 representatives of construction and mining enterprises from 6 federal districts of India, using the following categories of equipment in their activities: excavators, bulldozers, concrete pumps, drilling rigs, generators, rollers, compressors, truck cranes, tower cranes, scaffolding and formwork, mobile living quarters, loaders, lifts.
The ratio of owned, rented and used equipment
The largest share of leases is observed for such types of equipment as excavators and bulldozers (by ...%), the smallest - by drilling equipment, compressors and generators (by ...%).
Diagram 27. The ratio of used, rented and owned equipment in mining companies, %
The reasons for the use of leased equipment by mining organizations were mainly: ...
That is, the main reason for renting is ....
3.2 Analysis of consumer preferences
Consumer preferences depending on the region are influenced by the following factors:
Adaptability of equipment to weather conditions
Consistently high demand for mining and construction equipment is observed in Siberia and the Far East. Machines are operated for mining and construction of facilities. In the northern regions, there is a growing demand for middle-class special equipment with specifications for cold climates. Such machines can operate at temperatures up to -40 ⁰С. Customers often demand that the equipment they supply be equipped with a Webasto engine preheater or heated filter-separator, as well as an insulated cab, sometimes with double glazing. This allows you to easily start the machine in cold weather, maintain the required performance and eliminate the possibility of downtime. And seat heating creates more comfortable conditions for the operator.
...
3.3 Market structure by sectors of consumption
Mining of other minerals (stone, sand, clay, etc.) is the leader in the sectoral structure of consumption. Over the period of 2013-2017, the share of the segment increased by ... p.p., which is associated with a decrease in the volume of coal and metal ores open pit .
Thus, market trends indicate an increase in demand for quarry equipment designed for the development of clay-sand, gravel pits, etc.
Part 4. Price analysis of competing companies
4.1 Rental rates for various mining machinery and equipment
Price analysis in the rental market of mining equipment was carried out in 2 areas:
Analysis of the prices of the closest competitors. ...
Analysis of price offers for renting mining machinery and equipment on specialized sites. ...
Price analysis of closest competitors
Table 9. Analysis of current prices for the rental of mining equipment in India (as of October 2018)
Analysis of price offers on specialized sites
Off-road dump trucks
In October 2018, rental rates for off-road dump trucks varied within ...
By supply regions, the highest rates were observed in ... (... Rs./shift), the lowest - in ... (... Rs./shift).
Heavy duty excavators...
Crushing and screening equipment ...
4.2 Lease payment structure
To analyze the structure of the lease payment, the costs and income from the operation of certain types of mining equipment were calculated.
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Table 10. Calculation of the lease payment structure, Rs.
Thus, the profitability of mining equipment rental activities varies within ...%.
...
Part 5. Consumption forecast until 2022
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Part 6. Recommendations and conclusions
6.1 Assessment of factors of investment attractiveness of the market
The investment attractiveness of the market is assessed based on an analysis of a combination of factors: sales potential, demand potential, barriers, main trends, competitiveness.
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6.2 Barriers and risks to market entry
The analysis carried out allows us to conclude that there are a number of barriers to entering the market for renting quarry equipment for a new enterprise: ...
...
Thus, a number of barriers and risks prevent a new company from entering the mining equipment rental market. However, barriers and risks are typical for any investment project and can be overcome through competent management.
6.3 Conditions for achieving business efficiency in the special equipment rental segment
Based on the foregoing, we can conclude that business development in the field of mining equipment rental is investment attractive: .... At the same time, in order to ensure successful entry into the market and achieve efficiency, it seems appropriate to take into account the following recommendations:
...
Diagrams
Diagram 1. Mutual influence of factors on the market of mining equipment
Diagram 2. Dynamics of India's GDP, in 2011- Q2 2018, % to the previous year
Diagram 3. The dynamics of the US dollar against the rupee, Jan. 2014 - August 2018, Rs. for 1 US dollar
Diagram 4. Industrial production index for all types of activities Jan. 2014-September 2018, % to the corresponding month of the previous year
Diagram 5. Population change in India, 2010-2018
Diagram 6. Dynamics of real incomes of the population of India, 2016-January-July 2018
Diagram 7. Industrial production index by type of activity ""Extraction of stone, sand and clay"" January 2014-September 2018, % to the corresponding month of the previous year
Diagram 8. Industrial production index by type of activity ""Extraction of other minerals"" January 2014-September 2018, % to the corresponding month of the previous year
Diagram 9. The dynamics of the commissioning of buildings in India in 2013-2017
Diagram 10. The volume of work performed by the type of activity ""Construction"" in India in 2013-2017
Diagram 11. Length of public roads in India as of January 1, 2013-2017
Diagram 12. The share of some types of mining equipment with an expired service life in India in 2013-2017,%
Diagram 13. Dynamics of the construction machinery and equipment rental market in India in 2013-2017, billion Rs.
Diagram 14. Market dynamics of the rental of other land vehicles and equipment in India in 2013-2017
Diagram 15. Dynamics of the rental market of other machinery and equipment not included in other groups in India in 2013-2017
Diagram 16. Dynamics of the mining equipment rental market in India in 2013-2017
Diagram 17. Dynamics of the capacity of the rental equipment market in India in 2013-2017
Diagram 18. The structure of the mining equipment rental market by type of equipment in 2017
Diagram 19. Structure of the quarry equipment rental market by year of manufacture in 2017
Diagram 20. The structure of the quarry equipment rental market by tonnage in 2017
Diagram 21. The structure of the mining equipment rental market by country of production in 2017
Diagram 22. The structure of the mining dump truck rental market by brand in 2017
Diagram 23. The structure of the mining excavator rental market by brand in 2017
Diagram 24. Screen rental market structure by brand in 2017
Diagram 25. Supply structure of mining equipment rental by company type (based on the number of offers) in 2018
Diagram 26. Shares in the rental market of mining equipment in India of the largest competitors
Diagram 27. The ratio of used, rented and owned equipment in mining companies, %
Diagram 28. Reasons why mining companies use rental equipment
Diagram 29. Dynamics of the sectoral structure of consumption of mining equipment rental services in India in 2013-2017
Diagram 30. Maximum, minimum and average rental rates for off-road dump trucks in October 2018, Rs./shift
Diagram 31. Maximum and minimum rental rates for off-road dump trucks in October 2018 by region, Rs./shift
Diagram 32. Maximum, minimum and average rental rates for heavy excavators in October 2018, Rs./shift
Diagram 33. Maximum and minimum rental rates for heavy excavators in October 2018 by region, Rs./shift
Diagram 34. Maximum, minimum and average rental rates for crushing and screening equipment in October 2018, Rs./shift
Diagram 35. Maximum and minimum rental rates for crushing and screening equipment in October 2018 by region, Rs./shift
Diagram 36. The structure of the lease payment for mining equipment
Diagram 37. Forecast of consumption of mining equipment rental services in India for the period 2018-2022
Tables
Table 1. Assessment of the correlation of macroeconomic factors and the quarry equipment rental industry in India in 2013-2017.
Table 2. Assessing the correlation of social factors and the quarry equipment rental industry in India in 2013-2017.
Table 3. Assessment of the correlation of industry factors and the development of the quarry equipment rental industry in India in 2013-2017.
Table 4. Assessment of the correlation of technological factors and the development of the mining equipment rental industry in India in 2013-2017.
Table 5. STEP analysis of factors influencing the quarry equipment rental market in India
Table 6. The share of equipment purchased for leasing in the total volume of purchased equipment by country, %
Table 7. Dynamics of the number of requests in the Yandex search engine for the rental of special equipment and mining equipment in January-November 20117-2018
Table 8. The structure of consumer preferences in the field of mining equipment rental by regions of India depending on the consuming industries
Table 9. Analysis of current prices for the rental of mining equipment in India (as of October 2018)
Table 10. Calculation of the lease payment structure, Rs.
Table 11. Calculation of the forecast for the consumption of services for the rental of mining equipment for the period 2018-2022.
Table 12. Assessment of factors of investment attractiveness of the quarry equipment rental market
Table 13. Risk assessment
Research benefits
The most complete presentation of information in an accessible and visual form. When ordering a marketing research, you can be sure of the accuracy and reliability of market information, which allows you to make informed management decisions and not miss the attractive opportunities that the market provides.
Directions for using the results of the study
To bring a new product to the market, organize a new production, correct the current strategy of the company or develop a new one, to make various decisions.
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