Analysis of the Indian Mechanical Electrical

Plumbing (MEP) Services Market

A Perspective on Growth Opportunities

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March 2014

Contents

Section

Slide Number

Market Overview

Forecasts and Trends in Indian MEP Services Market

16

Conclusion

24

The Frost & Sullivan Story

30

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Executive Summary
The mechanical electrical plumbing (MEP) services market is going through a growth
phase, although the growth is little muted due to the prevailing economic and political
uncertainties.
MEP services market is highly fragmented with hundreds of contractors in India, however
not all have a pan-India presence.
The MEP services market is highly competitive for all categories of MEP contractors.
In the overall MEP services market, the top 8 industry participants account for less than
% of the total revenue.
The estimated annual revenue generated by MEP services market stands at about
INR
billion in FY 2013.
The growing number of complex construction projects has resulted in specialised activities
that address all the MEP needs of an end user.
The market participants expect to see a boost in growth after the general election in 2014.
Source: Frost & Sullivan
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Market Engineering Measurements

MEP Services Market: India, FY* 2013
Market Overview

Competitor Overview

For a tabular version click here.

*Financial Year duration April to March
Note: All figures are rounded. The base year is FY2013. Source: Frost & Sullivan
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MEP Services Scope and Definitions

Commercial

Residential

Industrial

Infrastructure

End-user Segment
Health club and beauty saloons
Food and beverage
Hospitality
Industrial
Educational Institutions
Healthcare
Residential/Housing Sector
Infrastructure

Category B
Mechanical
Electrical
Plumbing

Customer

The study covers the overall MEP

services market in India, which
encompasses the residential,
commercial, industrial and
infrastructure end users.

Category A
MEP Services Provider

The MEP services market is

comprised of companies that install
the mechanical, electrical and
plumbing equipment in a building.
These companies may or may not be
involved in the designing process.

Category C
Category D

Description
Including gyms, spas, sauna and so on
Multinational coffee or tea shops chains; restaurants (especially dining); food
chains such as KFC, McDonalds or Indian equivalents
Hotels, resorts and theme parks
Factories
Schools, hostels, guest houses
Hospitals
Housing complexes, residential apartments, farm houses, villas, dormitories and
so on
Airports, sea ports, telecom
Source: Frost & Sullivan

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Key Industry Challenges

The market faces many challenges such as the perfect competition business environment that exists in
the Indian market for MEP services. Moreover, the economic instability in the country and the world
further compounds the crisis. The key challenges being faced by the market participants are:
Price undercutting by category-B contractors: The market has hundreds of contractors who tend
to shift sectors to compete on prices; the one with the lowest quote price is usually handed the
contract. This is true for all the categories of contractors (A, B, C, D). Therefore customer relationship
plays a significant role.
Customers tactics of playing one-against-the-other: Since most services offered by a contractor
are indistinguishable from its competitor, customers find it easy to play one against the other in order
to extract the best price possible. This also means that contractors need to communicate better with
prospective clients to convey their value proposition rather than only focusing on the price.
Payment delays: The economic crisis has upset the normal growth trajectory of most sectors and
real estate development is no exception. The payment cycles have been affected as they are
deferred to a later date. This make is difficult for contractors to grow business, hire professionals, pay
for material equipment and so on.

Source: Frost & Sullivan

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