With rising demand, batteries and UPS industries have introduced advanced technologies. But the only fear for the Indian manufacturers is Chinese products, which enjoy a cost advantage.

Batteries and UPS (uninterruptible power supply) systems are a great combo to run an electronic device effectively and an ultimate choice for power backup. What was once meant as a back-up for critical equipment has now become a necessity in homes and offices across the country, thanks to the chronic shortage of electricity across the country, the only exception being the megapolis of Mumbai which is the only city in India to get assured power supply. With the rising demand in the Indian market, manufacturers of UPS systems are keen in advancements and innovations. This has led to a rise in competition. "The demand for batteries is growing at a healthy double digit rate and I don't foresee this slowing down in the near future. Factors that are spurring demand are renewed hope in the economy and improved performance by the automotive industry after a spell of bad run," avers Aditya Arora, COO, Base Corporation Ltd.

Today, there are several leading battery and UPS players in India, contributing immensely to satisfy the ever increasing demand. "Today, batteries have to work more, weigh and cost less as well. This raises the need for newer technologies (purely input material) at a subsidised cost," adds Arora.

The leading battery manufacturers include Exide Industries, Amara Raja Batteries, Luminous Power Technologies, HBL Power Systems, Su-Kam Power Systems, Base Corporation, Okaya Power, Southern Batteries, etc. The major UPS players are ABP Power Solutions, Luminous Power Technologies, Riello Elettronica, Nelco, Keltron, Microtek International, Intex Technologies, Aplab, and many more. Together, they focus on meeting the rising demand of customers both nationally and internationally.

Globally, the demand for batteries is expected to rise 8.1 per cent annually to US$132 billion in 2016. China remains the largest market. India and South Korea are also growing at a greater pace. Currently, the battery industry in India has an approximate market size of 2,000 million units.

Even the UPS market in India has a great contribution towards the overall economy. By 2018, the UPS market is expected to grow at a compounded annual growth rate (CAGR) of around 12 per cent. "The growth of industrial and commercial infrastructure in India coupled with the rising energy costs has fuelled the need for more reliable and energy efficient power back-up systems," informs Syed Sajjadh Ali, Managing Director - India, Electrical Sector, Eaton.

The foreign players are keen on entering the Indian market for both, batteries and UPS systems. The joint venture business has enabled easy access to well-established distribution network and also develop advanced technology. Around 55 per cent of the organised UPS players have foreign tie-ups for supply of technology, while the remaining source their need indigenously.

Technological upgradation and advancement is the prime focus of these companies. The development in technology has made it possible for the manufacturers to offer batteries in different forms like Nickel Cadmium (NiCd), Lead Acid, Lithium Ion, Lithium Polymer, etc. Recently, researchers have developed new molten air rechargeable batteries for electric vehicles. These batteries have higher storage capacity than lithium batteries. High focus on R&D has made it possible to introduce lithium ion battery using sand as a key material. It is low cost, non-toxic, environment friendly. The manufacturers are also on an expansion drive. Recently, Panasonic Corporation announced that they have plans to set up a lead acid battery manufacturing plant. The unit is expected to start its operation by 2016. The rapid expansion of the automobile sector and rising need for power backup are the prime growth drivers for the lead-acid battery market. As per market research, the global automotive battery market will grow by 6.9 per cent over the period 2012-2016. Apart from lead-acid batteries, there are advanced technologies paving way for lithium-ion batteries. Currently, the market has taken a new dimension with vast opportunities. The demands are high for electric vehicle batteries, inverters, solar batteries, and electronic surveill-ance products.

On the other hand, UPS systems have been successful in playing a supportive role during power cuts for the commercial segment, but the scenario is declining among residential, which anyway needs only the simple system. The country has been experiencing about 8.5 per cent of power deficit during 2012, out of which, only 17 per cent is being addressed by the power back up market in India. This has offered huge opportunities for UPS manufacturers. The UPS system has kept the banking, healthcare, IT, hospitality, and other commercial segments working.

With rising demand, domestic as well as foreign players operating in this sector are constantly introducing new and innovative products to capitalise on the existing as well as potential market. There is a gradual inclination towards solar-powered and environment friendly UPS systems. Software features like artificial intelligence to switch off the equipment; alarm systems; digital displays to show critical voltages and frequency, etc., have of late been incorporated in UPS systems.

Recently, Eaton launched its 93E UPS. The 93E UPS delivers up to 98 per cent efficiency and 30 per cent smaller footprint. It is available in 80-400 kVA capacities. Schneider Electric introduced the standard SMT and extended run SMX Smart UPS models for the African market. According to an IMS Research Report, the overall Indian UPS market is projected to reach US $834 million by 2016. Even as the scenario seems to be positive for batteries and UPS segment, the challenges are vast. One of the major issues is the presence of Chinese players with cheaper products than those available locally. This has forced several local vendors to drop out of the race.

According to Arora, "Battery technology is one thing that hasn't kept up with the pace of other gadgets that use them and the challenge world over is to make batteries that can power and keep up with the growing demands of the gadget /appliances."

Besides, there is lot of unorganised suppliers offering low-priced products compared to the organised segment. This has resulted in stiff competition. The export potential of UPS is high, but manufacturers have not been able to exploit it. The reasons are due to high cost, bulky nature, lack of availability of add-on features, high component cost, and lack of aesthetics. The same is the scenario for battery export. Challenges are also in the form of excise duties and the import duties levied on raw material like lead batteries. If this industry has to grow rapidly, the government should support it through an easier tax regime.

Sajjadh Ali adds, "Under challenging scenario, the only way is to innovate and make products that offer more value and lesser total-cost-of-ownership. In addition, timely delivery and after sales service are also extremely important, especially for commercial and industrial applications. Eaton recognises the importance of after sales service and is continuously building a wide network - realigning partner structures to penetrate the Tier 2 and 3 cities." Overall, it can be concluded that if the Indian manufacturers supply products with international quality and at low prices, the market will certainly expand.