On the contrary, I think there would be an explosion of demand. There are multiple mega trends powering the growth of the entire power value chain and power equipment manufacturers are in a sweet spot.
Some of these mega trends:
Drivers of growth capex:
- Data Centers
Cloud migration is a huge driver. Plus AI which is like an avalanche gathering snow, will generate tremendous demand for electricity, that too, high voltage and stable electricity without any disruptions.
2. EVs and their increasing use (notwithstanding the current blip)
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In India massive capex in railways (think new, high speed trains) and electrification of railways
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Make in India and Atmanirbhar Bharat initiatives leading to a surge in manufacturing
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Increasing use of renewable sources of energy where there is huge fluctuation in production in geographical and time perspective (solar, wind etc produced only at certain times of the day/year in certain parts of the country) so the peak capacity for a given level of production has to be higher. Also, the power so produced has to be ‘evacuated’ immediately.
Drivers of replacement capex:
The transmission grid and the related equipment both in the US and India (not familiar with the situation in the rest of the world) is ageing and needs massive capex for replacement.
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