Indian lubes market is expected to grow at a compounded annual growth rate (CAGR) of 3 per cent, with the country likely to see continued demand for lubricants notwithstanding the emergence of the electric vehicle segment, according to a report.
On the contrary, the other key markets of the US, China, Japan and Russia, may witness a decline or slowdown in demand, as per the 'Kline's Global Lubricants 2022: Market Analysis and Assessment' report shared at an industry event here on Wednesday.
The factors that will drive this progression include a growing digital economy, industrialization, urbanization, increasing discretionary spending, and increased investments in infrastructure development, it said.
In 2021, India's lubricant market bounced back with double-digit growth after witnessing a strong decline in 2020 due to the COVID-19 pandemic.
The market continued to grow further and exceeded pre-pandemic demand levels in 2022, it said.
The report noted that India is a bright spot in the global lubricants market thanks to forecasts for significant growth, Kline & Co said.
Also Read
AP liabilities rose by 12.6% CAGR under YSRC to Rs 6.5 trn: Official
Indian Web3 industry growing at 57% CAGR, to reach $1.1 bn by 2032: Report
Indian hospitality sector on a comeback trail with promising growth-report
India suffering high cybersecurity skill gap, 40k open positions: Report
Medical robotic market set to witness 8% CAGR to $15.8 bn by 2030: Report
Bill introduced to start private mining of deep-seated critical minerals
GST Council to finalise taxing rules on online gaming on August 2
Telecom PLI: Companies clock Rs 6,911 crore exports till May 2023
Relative to their GDP, states' liabilities moderating after pandemic
PMO probing dumping of Chinese stainless steel, said Abhyuday Jindal
"By the end of this decade, the lubricant supply chain in the country will be further strengthened with an increased domestic supply of base oils due to new capacity additions by national oil companies," Milind Phadke, Vice President, Kline & Co was quoted as saying in a statement.
Among the top five major lubricants-consuming countries globally, India is the only one with strong lubricant demand growth potential, the company said in the report, adding, in contrast, other markets such as the United States, China, Japan, and Russia are likely to witness a decline or slowdown in lubricant demand growth.
Over the next decade, despite the emergence of electric vehicles, lubricant consumption in India will continue to grow. At the same time electric vehicles will create demand for specially developed fluids, called EV fluids or e-fluids, it stated.
With most population growth primarily occurring in the lower-income segment or middle class, mobility usage is also changing with more focus on low cost and flexibility. Affordability has been a major influence on user preference for public transport and two-wheelers, it said.
Thus, two-wheelers will continue to lead the personal mobility space and drive demand for motorcycle oils, the statement added.
According to Satyan Gupta, Director, Kline & Co. The market value is expected to grow at an even higher CAGR of 6 per cent during this period with increased consumption of high-value low viscosity synthetic products.
The B2B segment (commercial automotive and industrial lubricants) will witness slightly lower growth at a CAGR of 2.7 per cent between 2022 and 2027. Even in this segment, the value is expected to grow faster (CAGR 6.9%) than volume, as per the statement.
The commercial automotive lubricants market is expected to go through a phase of transition with increased adoption of higher-quality lubricants by vehicle owners. This transition will be driven by the Vehicle Scrappage Policy, which will increase the scrappage of older vehicles beyond a specific age and subsequently support additions of new vehicles in the vehicle parc, it added.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)