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Indian Water Purifier Market Outlook 2013

Article · May 2013

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Shaminder Kochar
Independent consultant, Water Industry
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Indian Water Purifier
Market Outlook 2013
 Safe drinking water
• Safe drinking water is linked closely to the well-being of human life.
• In India, the primary sources of drinking water, that include surface water
and groundwater, are contaminated by different physical impurities,
agricultural and industrial wastes and underground chemicals and
minerals.
• Water borne diseases are widespread, especially among the low income
class of the society.
 Indian Water Purifier Market Scenario
• Today, in India, around 500,000 children under five years of age die each
year due to waterborne diseases like diarrhea.
• 75 per cent of India’s rural population does not have access to safe drinking
water and over 80 per cent of diseases and 33 per cent of deaths are
caused primarily due to unsafe drinking water.
• Low-cost gravity water purifiers catering to the majority of the market will
see maximum growth between 2012 – 15 & will improve the market
penetration.
 Water Purifier Industry in India
• According to the industry reports and the secondary data available from
report titled ‘India Water Purifier Market Forecast & Opportunities,
2017’ the water purifier market in India has shown tremendous growth
opportunities in last couple of years.
• The water purifier market in India is estimated to witness compounded
annual growth rate of 25% till 2017 to make it a whooping USD 760
Million market by 2015.
 Around 9-10 Million homes own water purifier out of
220 Million Indian Households (~5% penetration)

30
25
20 Annual sale (units)
15
10 Total field population
5 (units)
0 Total field population…
Annual sale (units)
2011 2013 2015

Estimated total sale of 10.2 million units, in 2015

(estimated penetration ~ 12.7 % ,almost 28 mo units population)
 Water Purifier Industry in India

Water purifier segment in India is growing at a compounded annual

growth rate (CAGR) of about 25 per cent and is likely to touch Rs 7,000
crore by 2015 from the current level of about Rs 3,200 crore.
According to industry studies , the sales of water purifiers across India
are likely to cross 1.5 crore units by 2015 from the current level of over
78 lakh units.
 Indian Water purifier industry to reach Rs 5K -6K crore
(USD 1 -1.2 billion) by 2015

8000
6000
4000
2000
0 2012
2015
2015
2012

New entrants in the gravity purifiers segment have increased the opportunity size for the water
purifying market as it has been able to envelop the Bottom of the Pyramid (BOP) segment of the
population as a target market for the water purifier. This segment of the population was not
considered a target market by incumbent water purifier makers.
 Water Purifier Industry in India
There are three types of water purifiers marketed in India – the ultra-
violet, reverse osmosis (RO) and resin- based one. RO-based purifiers
are the most expensive - priced at Rs.13,000 and above,
while UV-based purifiers are priced between Rs.5,000 and Rs.9,000. Non
Electric water purifiers are more affordable at Rs.1,500 onwards.
 Water Purifiers growth for different
Technologies/segments

8000
7000
6000
RO Purifiers
5000
UV Purifiers
4000
Unorganised WP
3000
2000 Gravity purifiers
Gravity purifiers
1000 Unorganised WP
UV Purifiers
0
RO Purifiers
2011
2013
2015

Units in ‘000
 Market Penetration growth for Water
Purifiers in India
14.00%
12.00%
10.00%
8.00% % penetration - Gravity
WP
6.00%
% penetration -All
4.00%
Purifiers
2.00%
0.00% % penetration -All…
% penetration -…
2012 2013
2014 2015

Estimated total sale of 10 million units, in 2015

(estimated penetration ~ 12.7 % ,almost 28 mo units population)
Source : ASSOCHAM study, TV Journal , slideshare.net , India water review , Water Industry
Fraternity
 Water Purifier Industry in India
The offline water purifier segment will account for 38% (2011: 20%) of
the total market space in 2016. The growth of the offline segment
will primarily be attributed to low pricing (i.e. US$19 per unit)
enhanced penetration across rural population and households.
 Gravity Water Purifiers - India
• Chemical based purifiers, Aquasure and Pureit are the largest selling
brands of water purifiers sold in India. Both are becoming increasingly
popular because they are effective and affordable.
• Also, they do not run on electricity and are ideal for locations where
power supply is unpredictable. Neither do they demand continuous
water supply.
• Power and water are still scarce even in urban India.
 Factors affecting penetration:
Technology , Reach & Pricing

When it comes to providing clean drinking water, low –middle income

households rate quality (adjusted for local conditions), price, easy to use,
water taste and lesser maintenance cost as important criteria while
deciding to buy a water purifier.
Availability , distribution , retail network, visibility, direct sales & awareness
campaign plays an important role in above.
 Water Purifier Industry in India
The fast-growing water purifier market is set to see a handful of new
entrants, including home-grown Luminous Water Technologies and
Japanese multinational Panasonic, offering a range of products, especially
in the reverse osmosis (RO) category.
While Luminous Water Technologies is betting on its strong distribution,
Panasonic is likely to bank on its brand recall. However, both Luminous
and Panasonic will have to fight it out with established players like Eureka
Forbes, Kent, Hindustan Unilever (HUL), Whirlpool and LG in the RO water
purifier market in India, where companies like Tata Chemicals have a
strong presence in the entry level category.
 Water Purifier Industry in India
After-sales services is expected to remain as the most important non-product
competitive factor in the POU water purifier market, as consumers are very
particular about the maintenance cost.
The market participants have started focusing on innovative and cost-
competitive technology, with better quality and third-party certified products
meeting international standards.
The degree of competition appears to be intensifying specially for the non-
electric product category.
The share of revenues from after-sales services and replacement filters is
showing an increasing trend.
 Thank You

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