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Qualification lock-in - pumps & valves (nuclear & process codes)
What it is
Supplying pumps, valves and equipment to nuclear, defence, refinery and critical process applications requires certification to codes such as ASME, API and atomic energy standards, plus customer audits and demonstrated supply history
Qualification is product and application specific and takes years
Impact on industries
- The strongest moat available in an otherwise commoditised product category - qualification cannot be bought or accelerated with capital
- Realisation is set by criticality rather than by material content, since a failed valve in a reactor or refinery is catastrophic
- India's nuclear expansion plans and refinery capex give the qualified supplier a defined long-term pipeline
- Slow and expensive to obtain, with no revenue during the qualification cycle and no guarantee of subsequent orders
- It splits the industry cleanly - qualified suppliers compete on capability, everyone else competes on price in the tender market