Indian manufacturers eye 2-3x profit growth with Industry 5.0: PwC report

Nearly half of Indian manufacturers said they invested in supply chain resilience with real-time analytics. Over 50% of them focus on sustainability, and 46% on strengthening cybersecurity

About 93 per cent of Indian manufacturers are adopting sustainable practices through Industry 5.0, aiming to boost profits by 2-3 times in the next three to five years, says a recent PwC India report. The report titled ‘Decoding the Fifth Industrial Revolution: Marching towards a resilient, sustainable and human-centric future’ covers six major industries. It finds that Industry 5.0 offers a way to improve financial and operational performance while building a human-centred manufacturing ecosystem.

 

Industry 5.0 marks a shift from prioritising economic value to creating societal value, moving the focus from mere welfare to overall well-being.

 

According to the report, more than half of Indian manufacturers are channeling investments towards adopting renewable energy and energy efficiency through advanced digital technologies. Also, 52 per cent of senior executives are prioritising a culture of lifelong learning to upskill the workforce, preparing them for the symbiotic integration of AI, robotics, and IoT.

   

“Industry 5.0 represents a defining moment for the manufacturing sector – one that creates a symbiotic relationship between humans and advanced technologies,” said Sudipta Ghosh, partner and industrial products leader at PwC India. Ghosh emphasised that manufacturers prioritising these technologies will likely achieve a competitive advantage, as Industry 5.0 is integral to building a sustainable, resilient future.

 

Sector-specific insights

The adoption of Industry 5.0 is expected to increase Indian manufacturers’ revenues by an average of 6.42 per cent over the next two years. Manufacturers believe that their underdeveloped Industry 5.0 capabilities may have cost them 4.37 per cent in the financial year that ended on March 31, 2024 (FY24) revenues.

 

Meanwhile, the chemicals, cement, and textiles sectors are expected to see the highest revenue growth, with potential expansions surpassing 7 per cent.

 

Sector-specific insights revealed that 95 per cent of manufacturers in the cement and industrial goods sectors are heavily invested in real-time inventory tracking this year, aiming to optimise inventory and minimise excess stock. Executives in the automotive and metals sectors also reported rising consumer willingness to pay a premium for innovative and sustainable products.

 

Industry 5.0 dispels job displacement concerns

PwC’s study found that Industry 5.0 fosters the workforce’s collaboration with advanced machines, dispelling concerns about job displacement. Ghosh noted that bottom-up innovation, driven by secure access to technologies like Generative AI, will need top-down guidelines to ensure safe and effective use. Around 52 per cent of executives are prioritising automation for repetitive tasks to allow employees to focus on higher-value work.

 

Other key findings from the PwC report were:

Responsive supply chains: Half of the respondents are investing in supply chain resilience, using real-time analytics to address potential disruptions.

 

Renewable energy and sustainability: Over 50 per cent are enhancing sustainability efforts, including waste reduction and responsible water usage. 

Cybersecurity: Recognising digital threats, 46 per cent of executives are bolstering cybersecurity to protect manufacturing systems and data integrity.