Building Product & Material Industry Observes Exponent Growth in Ahmedabad: BMR Research


Ahmedabad building materials and bathroom fittings market recovery is faster than other prominent cities in the country. Building Material Reporter (BMR) study in Ahmedabad building material markets indicates that the demand in all segments is increasing whether it is interior or exterior, cement or wood panel or bathroom fittings. A leading share trading and investment firm study says that cement price is on the hike in western and northern regions. Expert says that its volume increase will be more than 15% in Q4 2020-21. The demand in the western region has rebounded strongly, led by a recovery in urban real estate and construction.

The dealers, distributors, and channel partners are confident that the demand will improve to the next level despite that prices are going up because housing affordability is getting a boost. The incentive majors taken by the center and states and the extension for an affordable housing scheme for a year in the budget will definitely support the demand of the building material industry. The land price in Ahmedabad is observing an upward trend and is increasing exponentially.

After Covid, all of a Sudden the Demand Increased

Mr. Rajiv Trivedi, MD, Surface+ who is having a big showroom in the segment of bathroom fittings, kitchen, and sanitary-ware said that after Covid all of a sudden the demand increased and people are feeling happy. Every segment is doing well like Siemens Home Appliances, kitchens and bathroom Fittings are having three months waiting for delivery. Washing machines, dryers, dishwashers demand is at its peak. Covid period was a vacuum and currently we are at the cycle of the same period in 2019. Domestic house equipments demand is very good. Now after eight months of opening lockdown people are optimistic. The second thing is people started investing in homes for such constraint situations. It drove the building material demands, 'he said'.

Although the real estate sector across the country is positively performing well after a vacuum during the covid period. But Ahmedabad is observing the highest growth rate of 7% in the price of housing projects (Rs 3,213 per sqft on December 31, 2020) followed by Hyderabad with an average rate of 5%, Pune by 4%, and in DNCR & MMR rates are constant among the leading property markets like DNCR (Delhi National Capital Region), MMR (Mumbai Metropolitan Region), Pune, Ahmedabad, Hyderabad, Kolkata, Bangalore, Chennai, etc. The survey conducted by various agencies revealed that 47% of tenants like to invest in a 'rightly priced property'.

Ahmedabad building materials

The businesses were going on slowly during lockdown also but the activity was different. The architects were relaxed and experimenting in that situation of free time during the lockdown. But when the market is running and everyone is busy they ask for the material that is needed and do not bother what is happening in the market until they are made aware of the new happenings through social media, advt, and company efforts to do so' he added.

'If you look one year back, everybody was depressed and the situation brought a recession for over six months. The market was shut down, but people had to survive so the businesses were going on in a different way. They had to cut margins with stiff competition in a situation of lockdown - still needed to do business back doors hiding from the local police and authorities' he added further.

Wood Panel Industry Segment Recovery

Wood panel and Decor industry are also upbeat with the demand. 'After opening lockdown the marketing is picking up with a bit plus and minus,' said Mr. Abhishek Shah, AB Corporation, Ahmedabad who is operating in the wood panel and decor industry segment in retail as well wholesales. 'New projects are coming up well and inquiries are very good. Retail is also supporting the demand with rapid-paced constructions at outskirts of Ahmedabad.'

Abhishek Shah of AB Corporation ventured into the building material industry in the wood panel sector in the year 2000 as a retailer and now they are catering wholesales also. They offer every item for the interior such as veneer, highlighters, charcoals and lowers, designer panels in 2D and 3D, wooden flooring, alabaster sheets, Korean, etc.

'We are doing well with a good network of over 50 dealers in Gujarat only. We have our own catalog to cater interior and architects segment which is mainly dedicated to 2-3 BHK flats and bungalows. The architects and interior designers are well supporting the designer products because only they can perfectly visualize with a lot of decor products on the markets' he informed.

'For the wholesale range, we have imported highlighters procured from the importers of Mumbai. The veneer is another wholesale product with us which is moving ahead with our own brand but the procurement is being done from indigenous manufacturers,' he added.

Commercial Segment Property Demand is Low

When asked about from where the recovery is faster either Retail, industrial, institutional, or wellness segment? The dealers and showroom owners say that market is good in Ahmedabad for both retail as well as projects. Land prices have become double; all premium locations have been booked, projects are coming for higher segments. The commercial segment property demand is low as the corporate demand is not there in the market due work from home option for their employee.

Secondly, the huge damage to the hospitality industry people does not travel due to the increasing penetration of video conferencing across the world. Globally airline, as well as the hospitality industry, is going to be down by 30%. People are going to its habit now. The senior officials were traveling frequently who are now happy communicating with their professionals at far away distance and instructing them effectively. The experts say that the demand from the hospitality sector will be lesser followed by the commercial sector.

The market is Promising for Branded Products

Chintan Shah, Owner of Vikram Studio of Ahmedabad talks about the City's rising prospects for Bathroom and Kitchen Solutions. He says that the market overall has picked up after Diwali and the business before it was supported with pent-up demand or to whom the deliveries could not have been completed. The actual figure of business generation would be clear from orders received after March. At present, the sales base is 50 -50 from direct customers and projects however the demand for a branded products is growing, but to increase its market reach awareness via channel partners, advertisement, and with the support of social media is a must.

Mr. Chintan Shah is in favor of offering the complete solution for making a home beautiful and aesthetically appealing either it is bathroom or kitchens or water solutions or modular kitchen. He thinks the best part is that every class of people is looking to upgrade their lifestyle. This is beneficial to everyone, there are some budget constraints at this point in time but they will be resolved in near future and Ahmedabad will grow very fast.

While Mr. Abhishek Shah, AB Corporation says that the future of the Building Material Market looks promising as the builder's segment is bullish with expanding dwelling area of Ahmedabad supported by the rapid industrialization of the region. They accept that the role of display gallery in retail business plays a very important role and the showroom importance is much more as the touch and feel factor can only happen in display gallery and showrooms.

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