NEW DELHI: Polyvinyl chloride (PVC) pipes and fittings manufacturers are set to sustain their momentum witha 13-15% on-year volume growth next fiscal, driven by higher budgetary allocation for government
schemes in water supply, irrigation, housing, and infrastructure, according to Crisil Ratings.

This will follow decadal-high growth of 22-24% in the current fiscal, driven by strong pent-up demand, after a subdued compound annual growth rate of ~2% over the past three years.

For players in the sector, more than 70% of the demand comes from agriculture, water supply, irrigation, and sewerage, and depends, directly or indirectly, on government funding. The remaining demand is from residential plumbing and industrial applications.

The volume growth next fiscal will be sparked by two key demand drivers. One, higher capital allocation in the Union Budget for irrigation and housing schemes such as Jal Jeevan Mission (Rs 69,684 crore, up 27% on-year) and Pradhan Mantri Mission (Rs 69,684 crore, up 27% on-year) and Pradhan Mantri Awas Yojna (Rs 79,000 crore, up 62%). And two, continued healthy demand from the residential real estate sector.