2021: The year that was
The year 2021 was a much better year compared to 2020. The demand for almost all products increased considerably and the cable was no exception. The projects that were stalled earlier got activated and the project owners were in a hurry for its completion. The stock markets boomed showing a highly positive outlook. The Aatmanirbhar Bharat policy also helped to generate more demand due to restricted or limited imports. The defence sector opened up, railways and other infrastructure also got a boost by more government funding. Investment in the renewable power sector also increased considerably. The business volume has exceeded the pre-COVID level of 2019 and the trend continues to be positive.
While there has not been any capacity expansion (other than debottlenecking) in 2021 as we were trying to first consolidate our business to pre-COVID levels, looking at the increasing demand and very favourable outlook, action has been initiated for a significant capacity enhancement that will reflect in 2022.
The demand in the international market is increasing and China is not having much favourable situation due to its policies, there is an opportunity for Indian cable products in the international market. We have worked in that direction for product development and international product certifications, which have helped in 2021 and will also help in the following years. We expect to be a significant player in the international market.
2022: The year that will be
We expect to do a business volume better than the pre-COVID level, though there is too much competition at present in the domestic market. We have worked to improve our exports and the impact will come next year both in volume and profitability.
We have carved out ourselves as a quality product supplier over the last several years and will continue to do so. We are working towards better market reach both in the domestic and in exports. We are in the process of obtaining several consultants and key customer approvals in the domestic market to enhance our reach. Similarly, we are expanding our footprints in more countries for export business. We hope to increase our export sales from 15 percent to over 30 percent in 2022 itself and higher in the following years.
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Key Trends Driving the Growth
The increased investment in infrastructure, railways including metro railway, defence, renewables, power distribution are the key drivers of business growth in the domestic market and we are well poised to take advantage of the situation. The climate change commitments at COP26 are a major driver for a fast expansion in the renewable sector, where the country is committed to generating 500 GW of clean energy by 2030 and it means a lot for this sector. The metro railway projects in all tier 2 cities are another area of volume growth. The not so favourable sentiment for Chinese products is another opportunity to take a significant part of that business in the international market. Apar Industries is well-placed with its cable products to take advantage of the emerging situation.
