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The charging points operators (CPO) segment in India is still in its infancy, and strategic partnerships and alliances would be crucial for players to develop and sustain their competitive advantage in the CPO market, according to a report by KPMG India.
In India, growth in the EV segment is led by the two-wheeler (2W), three-wheeler (3W), and bus segments. As of March, the number of EVs on Indian roads has crossed one million. The report estimates the number will grow to 45-50 million EVs on the road by 2030, presenting an enormous opportunity for players in the EV charging ecosystem.
Currently, the country has approximately 1,700 public charging stations, which are insufficient to support EV growth. In 2021, the number of charging points was around 1.8 million globally, with China accounting for 85 per cent of global fast chargers and 55 per cent of global slow chargers.
“Development of a robust charging network has gone hand-in-hand with accelerated EV adoption across the world, and we believe a similar trend is expected to play out in India. With an estimated 50 million EVs on Indian roads by 2030, the potential opportunity for a pure-play charging business is enormous,” said Rohan Rao, Partner, M&A Consulting, KPMG in India.
Policy push for investments
The investments in the charging space are expected to be pushed by increasing interest from the public and private players along with a strong government push through policy initiatives such as FAME-II, which aims to provide ₹10,000 crore in demand incentives for EVs; 100 per cent FDI for EV assembly; and a ₹18,000-crore PLI scheme for ACC Battery manufacturing to incentivise domestic production, among other things.
According to the report, the global investment activity is expected to increase from $0.8 billion in 2020 to $2.3 billion by 2022-end. Investment activity in this segment has surged in the last two-three years as investors see players in the EV charging market as promising investment prospects.
The report suggests partnering with municipal bodies to set up 3W charging points in public parking lots, metro stations and so on to help a CPO to capture the vast potential of the fastest-growing EV segment in the country.
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