U.S. Municipal Water Equipment Markets - Investment Analysis and Growth Opportunities

Research Overview

Frost & Sullivans Water Financial Benchmarking and Analysis (FBA) service presents a broad financial outline of the water industry, highlighting major market and financial trends in key growth segments. It provides a comprehensive financial analysis of leading U.S. water equipment firms to support the investment and financial analysis needs of decision makers in the water arena. The current study within the service focuses on four key growth segments of municipal water equipment: water treatment equipment, water meters and accessories, water pumps and components, and water pipes and fittings.

Increasing Urbanization and Strict Water Regulations Boost Opportunities for Water Treatment Equipment

Water is slowly turning into a scarce commodity, and the growing demand for it is drawing the attention of the financial community. Large conglomerates are buying out smaller water companies, and an ever-increasing number of investors are turning their attention to this sector.

As the trend toward urbanization continues, the U.S. Environmental Protection Agency (EPA) continues to enforce stringent water quality regulations through the Clean Water Act (CWA) and the Safe Drinking Water Act (SDWA). Further, a booming population and an aging water infrastructure promise considerable growth opportunities for water treatment equipment vendors.

Replacement and Upgrade of Water Infrastructure May Draw Investments

A recent report on the U.S. drinking water infrastructure, published by the American Society of Civil Engineers, rates the aging U.S. water infrastructure as a D, signifying its poor state. In order to ensure compliance with safety standards dictated by the SDWA, the EPA estimates investments to the tune of around $150 billion will be necessary over the next 20 years to upgrade and replace the water infrastructure.

A Healthy Municipal Water Equipment Market Will Boost Overall Revenues for Manufacturers

The increase in public awareness on drinking water quality standards, and the current state of water municipalities in the United States, has led federal agencies to undertake corrective measures at a fast pace. Amid predictions that water will be to the 21st century what oil was to the 20th century, the water market is drawing substantial investments. The transmission and distribution category is drawing the bulk of the investments on account of the ongoing upgrade of municipal water treatment and distribution plants.

"With the need to develop efficient technologies to tackle new-found contaminants, the market promises good growth for water equipment companies," says the analyst. "Though pumps and pipes companies may to grow at a lower rate, backed by increased sales in the advanced meter reading equipment, water meter companies are poised to show high growth rates."