How glass, which used as mirror at homes, now becoming most important building material

Float glass which has emerged as an important component of modern-day building infrastructure is gaining in prominence day by day. The domestic demand for float glass is projected to reach 4.6 to 5 million tonnes by FY26 growing at a CAGR of 12-14 per cent from FY21 to FY26. In value terms it translates to Rs 16,500-Rs 17,500 crore. However, India is dependent on imports as all players operating in India have a combined production capacity of 2.5 million tonnes which is projected to grow to 3.3 million tonnes by FY26.

Select players

The Indian float glass manufacturing industry is a highly consolidated one with only five organised players and none from the unorganised sector. Saint Gobain India Private Ltd (4,050 TPD tonnes per day), Gold Plus Glass (1,250 TPD), Asahi India Glass (1,200 TPD), Sisecam Flat Glass (600 TPD) are the key float glass manufacturers and Borosil Renewables (450 TPD) is into manufacturing of solar glass.

The demand for float glass is coming from unprocessed glass, covering clear, tinted, mirror, reflective, lacquered and frosted glass. Pent-up demand and faster-than-anticipated recovery in the buildings and construction segment is driving demand. Since imports form a significant proportion of domestic demand, there is a pressing need for capacity expansion in the country.

Fastest growing

Float glass is expected to be amongst the fastest growing building materials in India. It is produced in wide-ranging dimensions, and is available in sizes of 0.4 mm to 25 mm thickness. Apart from aesthetic utility, it serves functional utility such as privacy, energy conservation, safety, protection against fire, and noise insulation.

Float glass is largely being used as a material in building and construction industry. It directly or indirectly competes with other building materials such as paints, plywood and laminates and ceramic tiles.

Imports historically have been high due to limitation in domestic capacity. Imports, which typically range from 20 per cent to 30 per cent of domestic demand, are expected to shoot up to 34 per cent of domestic demand in FY22. A majority of this import was of clear glass.

Heavy capex

The float glass industry has high entry barriers globally because of high capex requirement among other factors. The industry is highly capital intensive. As a thumb rule, a capital expenditure of Rs 1-1.25 crore is required to set up one tonne per day (TPD) capacity.

And to achieve operational sustainability and profitability, a minimum float line capacity of 500-600 TPD is required, translating into approximately Rs 500-600 crore capex requirement.

Limited capacity addition

Post 2019, there has been no fresh domestic capacity addition. Gold Plus Glass, the second largest player, has announced plans to set up an additional manufacturing facility with an annual installed capacity of 584,000 TPA (equivalent to 1,600 TPD) of float glass in Belgaum, Karnataka. The entire capacity is expected to be operational by the fourth quarter of FY24.

It is also planning to set up another production line for the manufacture of silver mirror with an annual installed capacity of 36,500 TPA (equivalent to 100.00 TPD) at its Roorkee manufacturing facility which is expected to be operational in the second quarter of FY23.

Also the company is planning to set up annual installed capacity of 109,500 TPA (equivalent to 300 TPD) of solar glass capacity in Belgaum, Karnataka. This is expected to be become operational in the second quarter of FY24. In 2019, Saint Gobain India added a fifth line with 1,200 TPD capacity in Chennai. In 2014, it added a fourth line with 900 TPD capacity in Bhiwadi, Rajasthan. Asahi India restarted its 500 TPD float glass line in Taloja in November 2017.

CRISIL Research's market check indicates that in FY21 northern region dominated the demand share for float glass, with 31 per cent to 33 per cent of pan India share, followed by the western, southern and eastern regions, at 28 per cent to 30 per cent, 27 per cent to 29 per cent, and 10 per cent to 12 per cent, respectively.

Value added glass

CRISIL Research estimates approximately 82 per cent of float glass consumption in FY21 to be from the building and construction segment, followed by 13 per cent and 5 per cent from automotive and industrial applications, respectively.

Float glass applications volume demand in building and construction is expected to grow at a CAGR of 12-14 per cent from FY21 to FY26. The demand in automotive and industrial is expected to grow at a CAGR of 10-12 per cent and 14-16 per cent respectively from FY21 to FY26.

Almost all commercial buildings and modern retail spaces are being today designed with glass exteriors. The bulk of planned investments are in brownfield capacity expansion projects for airports such as Delhi, Bengaluru, Chennai and Hyderabad.

Investments in airport infrastructure are expected to drive demand for architectural glass in windows, automated sliding doors, partitions and floorings. Even across hotels and hospitals value added glasses are being used for interiors and has seen increase in users for the applications. Demand for glass in railways will be driven by increase in passenger traffic and subsequent increase in demand for railway coaches. The use of glass in railways is also going up due to gradual shift in demand towards preference for air-conditioned travel which necessitate deployment of air-conditioned coaches.

Air-conditioned coaches have larger glass content than non-air-conditioned coaches. Growing tourism and introduction of trains meant tourism with panoramic view is also creating demand for glass. Demand for glasses will also be driven by rapid growth of Mass Rapid Transport System (MRTS) in India. As per Niti Aayog, India needs an investment of Rs 1 trillion in infrastructure projects by 2030 for augmenting its mass rapid transport systems. Investments in MRTS are likely to drive demand for metro coaches supporting the demand for glass. Corporates as well as hospitality industry are renting properties which elegantly designed. Value added glasses have helped interior designers achieve these objectives. Therefore, lacquered glass is being used for designing of hotel interiors, office interiors as a part of furniture, pillar claddings, lift lobbies, washrooms and panelling. Frosted glass is being used at places which demand reasonable privacy and isolation within the corporate offices. So glass once used as mirror or having limited applications at homes has now gripped our lives. And this is only the beginning.

(The author is a Mumbai-based senior journalist)