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Avendus Capital report highlights metal forming growth in auto sector
Articles- Apr 01,26
India’s auto component industry is shifting toward process-led manufacturing, with metal forming expected to grow at ~12 per cent CAGR to $90–95 billion by FY30.
Avendus Capital has released a report on the Indian auto component industry, highlighting a structural shift in global automotive supply chains that is driving value concentration toward process-led manufacturing segments, particularly metal forming.
According to the report, India’s automotive metal forming market — including casting, forging, stamping and machining — is expected to grow at approximately 12 per cent CAGR to reach $90–95 billion by FY30. This positions metal forming as one of the largest and most resilient value pools within the auto component ecosystem, supported by domestic demand and rising exports.
The report highlights a structural transition in the global auto component supply chain, with value increasingly concentrating on process specialists rather than diversified product suppliers. These specialists benefit from metallurgical expertise, precision tooling and long-standing operational experience, creating high entry barriers.
Koushik Bhattacharyya, Managing Director and Head, Industrials Investment Banking, Avendus Capital, said, “The Indian auto component sector is moving beyond a scale-driven growth phase into a capability-led consolidation cycle. Value is shifting toward process specialists, where manufacturing expertise and operational precision are key differentiators. As global supply chains evolve, India is well positioned to capture this opportunity, particularly in metal-forming segments. We expect sustained deal activity as investors build scaled, capability-led platforms.”
India’s auto component industry has surpassed $ 80 billion in FY25 and transitioned from a net importer to a net exporter, with exports reaching approximately $ 23 billion. This reflects both scale expansion and an upgrade in manufacturing complexity, quality standards and global integration.
A key driver is the reconfiguration of global automotive supply chains, as OEMs and Tier-1 suppliers diversify sourcing amid geopolitical and cost pressures. India is emerging as a preferred manufacturing destination due to cost competitiveness, engineering talent and an established supplier ecosystem.
Core metal-forming processes such as casting, forging and machining remain critical across ICE and EV platforms, with increasing requirements for precision, lightweighting and complexity. The report also highlights India’s “last man standing” advantage in ICE components. As global suppliers reduce investments in ICE manufacturing, India is positioned to capture a supply gap in drivetrain components such as crankshafts, gears and axles. With a global car parc exceeding 1.5 billion ICE vehicles, this segment also offers significant aftermarket opportunities.
From a deal activity perspective, the sector is witnessing increased investor interest, particularly in process-led businesses. Recent transactions show growing participation from global private equity firms and strategic acquirers, indicating a shift toward capability-led consolidation, with a focus on businesses offering process expertise, export orientation and scalable manufacturing platforms.
Indian auto component industry
metal forming market India
Avendus Capital report
automotive supply chain shift
forging casting machining India
auto component exports India
process-led manufacturing
EV components
ICE components
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