The Indian Lighting Industry – LED’s to Light the Way

In 2010, LED lighting market in India was just INR 500 cr, comprising a small percentage of the total lighting market. However the LED segment has grown exponentially over the last few years, from a small base in 2010 to INR 5000 cr at the end of 2015, and is projected to grow to INR 12,000 cr (CAGR of 25% per annum 2016-2019) and form nearly 50% of the total lighting Industry in India by the end of 2019.

Source: ELCOMA India, and Analyst Reports


In January 2015, the Modi Government announced a National LED program, run by Energy Efficiency Services Limited (EESL). The program aims to replace ~27 mn street lights (via municipalities) and ~770 mn units of GLS residential lighting (via state DISCOMs) with LEDs by FY 2019. This has been a strong driving force for LED growth in India.
The National LED programme will result in annual electricity saving of about 109 billion units and a 21,500 MW reduction in demand, translating to annual monetary savings of INR 700-800 cr, and lowering capex for setting up power plants in a power deficient country (Capex of INR 5-6 cr for setting up 1MW of thermal power unit).

TABLE A: National LED Progress till Feb 2017*

The Government’s push, along with a drastic fall in LED prices (already down to INR 100 from INR1,000-1,200 earlier) is expected to fuel a large scale switchover to LEDs. We also expect that commercial establishments (retail outlets/offices/shops) to increasingly opt for LED down-lights instead of the less efficient FTLs and CFLs, especially as the price gap between LED and CFL down-lights has narrowed significantly.


Philips Lighting is the clear leader in the LED lighting market in India, followed by Syska. The Top 6 companies comprise nearly 60% of the LED market in India. In the recent years, new players have entered the LED market like Eveready, Oreva etc and foreign players like Pharox too have joined in with the objective to participate in this fast growing market.

TABLE B: LED Revenues and Market Shares of Key Players


The listed lighting companies have all outperformed the Sensex in the last two and half years (as seen in Table C below), since the National LED Program was announced. This is a strong testimony given by investors that the Indian Lighting Industry is undergoing a huge transformation, driven by LED growth.

TABLE C: Stock Price Movement of Listed Lighting Companies in India from Jan 2015 to June 2017

We believe that India will become a major player over the medium and long term of the current $30 bn LED global market. With the Indian LED growth engine slowly gaining momentum, there is still a lot of ground to cover, and huge opportunities for existing lighting companies, and new ones to create sizeable LED brands in the country over a period of time.