As the infrastructure and construction fraternity gears up for the next phase of promising growth, here's a look into the views and visions of some select captains of industry.
The long-prevailing uncertainty in various infrastructure projects and the overall construction sector seems to be lifting with the Central Government recently clearing several large projects with a combined worth of more than Rs 6 lakh crore. However, there is an urgent need to fast track project execution to boost the business sentiment in the infrastructure and construction space. In this context, MANAS R BASTIA caught up with some of the leading construction equipment and allied players based in West India on their business outlook, strategic initiatives and action plan for the coming days.
"The focus should be on creating more roads." - Nitin Lall, General Manager, Atlas Copco Construction Technique
Projects underway: Our focus is on what we would like to term as retail sales, which comprises small contractors in the hiring segment as well as large conglomerates like L&T. We are actively engaged in both these categories with special focus on metro rail projects and large road projects. We are also working closely with certain Indian companies and contractors with business interests in the infra segment in the Middle East and Africa.
Strategy to scale up: Our strategy is clear. To have complete and dedicated focus on construction, we created a new vertical worldwide two years back. We have been investing in the market each year, be it in terms of reach, adding our own manpower and more dealers and of course expanding our service base to ensure customer satisfaction. We are one among a handful of companies in India that have invested in a state-of-the-art greenfield compressor plant in 2013 with an eye towards the future.
Future outlook: With India needing a lot of infrastructure growth, the time ahead should be quite bullish for almost all companies engaged in the manufacturing of related equipment. However, as they say, "It is not that USA built great roads, it is actually great roads which built USA." Hence, for India too, the focus should be on creating more roads - be it highways, expressways, state highways or our city roads.
We also need to see how the new metro rail projects start delivering. So far, only the Delhi Metro is working and being expanded. One thing leads to another. If the foundation is strong, it shall fuel other allied industries like quarrying, concrete, etc.
Message for industry: There is a need for faster decision making, accountability and a much better system of redressal so that the companies engaged in building a better India, do not feel that they are going to be alone, should something go wrong. They need to feel secure that the government will not change its course during the execution phase of a project and once approved, it will be taken forward. This confidence building measure is the need of the hour. Once we have addressed these core issues, the rest will follow.
"This year looks quite promising." - Abhijit Gupta, Managing Director, Case New Holland Construction Equipment India
Product strategy: We are focussed in offering our customers equipment that offers lower costs of operation as well as maintenance. With this in mind, we have introduced the EX series of backhoe loaders, which are at least 10 per cent more fuel-efficient. This range will be widened with more products to meet the varied customer needs. Further, in the long run we are working towards upgrading our existing line up of compactors and widening our product portfolio in the Indian market.
Path forward: New infrastructure projects that are expected to be cleared in the near future and the new government coming to power will set the pace of the construction industry. Good quality construction that meets deadlines will be imperative with globalisation. This will set the demand for the right type of efficient and quality equipment. This year looks quite promising and the demand for construction equipment will grow.
Message to policy makers: For the success of the PPP model, the government has to be more forthcoming in terms of setting the right guidelines and ensuring that they are implemented. With proper guidelines set by the authorities, we are sure that PPPs, with increasing participation from private players, will be the trend of the future.
"We should surpass sales of 80 cranes this year." - Surendra Malve, Director Technical, Anupam Industries
Product development: We manufacture electric overhead travelling (EOT) cranes. In fact, we are the number one in India in terms of manufacturing cranes of 350 tonne capacity. Moreover, we are developing cranes of 500 tonne capacity; this may take a year or two to reach the market, considering the size. Recently, we launched another model in the form of a self-erecting crane. It has twin arrangements - after folding it can tilt. These two large model cranes are construction equipment (CE) certified as per European safety norms, and we are the only CE certified manufacturer for such cranes in India.
Collaboration: We have a technical collaboration with Alfa Srl of Italy, a leading European tower crane manufacturer. This has placed us in a strategic position to offer a wide array of tower cranes for the ever-growing building industry with high rise constructions across the globe.
Way ahead: We had made a beginning four years ago with two models of 5 tonne capacity. Having sold about 20 cranes in the first year of operation, we sold 35 cranes in the next year. As we move forward, we expect to surpass sales of 80 cranes this year, which means we will have more than 150 such cranes in the market.
"We see big potential in India." - Rolf J Jenny, Member of the Board, Ammann Apollo India
Strategic partnership: The Ammann-Apollo partnership in India has provided a strong leadership combination of asphalt plants as well as for paving equipment in the country. We can offer the customers all that they need for higher precision sustainable equipment.
Capacity expansion: Apart from increasing the capacity of the company's Gujarat plant by 15-20 per cent, we are specially upgrading the quality of production in line with European technology. We see big potential in India because of the domestic market, which will grow significantly, and having it as a hub to reach out to other markets.
Future outlook: We expect a growth rate of 10-15 per cent in the Indian market from 2015 onwards. Post October 2015, we reckon the market should start picking up. In this direction, we are adding new products that have been developed in Europe. Going forward, we will manufacture these locally to increase our market share in India. Besides, we can leverage the global Ammann network and sell these products in Africa and the Middle East regions, where we have not been able to reach in the past.
"Stability is the key word that everyone is looking for." - Vikram Mehta, Managing Director, Spartan Engineering Industries
Project mix: We have always focussed on the changing needs of the Indian construction and infrastructure industries by delivering products with precision and strong support through after-sales-services. We cater to a mix of infrastructure and real estate projects.
Growth drivers: Growing infrastructure requirements from segments such as education, healthcare and tourism are providing opportunities in the real estate sector. The major growth drivers will be affordability, redevelopment activity, mass housing projects, faster government clearances and road infrastructure projects.
Business expansion: In the short term, we are targeting an increase in our production capacity to meet the growing needs of the current requirements. At the same time, we are working on developing products for affordable housing so as to help increase productivity in that segment. Also, we are planning to appoint dealers in Tier-2 cities to widen our reach. We have started a tower crane manufacturing plant in India and will be rolling out our first state-of-the-art tower crane in FY2014-15. In the long term, we aim to grow our product basket to serve roads, bridges and power plants better. We will also be venturing into the export market in a big way with higher capacity hoists of European quality.
Message to policy makers: Stability is the key word that everyone is looking for across secters be it the political scenario, policies or even financial parameters.
"Western companies are exploring how to homologate or decontent." - Samir Yajnik, President Sales and COO Asia Pacific, Tata Technologies
Beyond products: Our proposition is to have an end-to-end partnership be it product pricing, material used, features and contents and its applicability to the customer. In fact, our recent acquisition - Cambric Corporation - a premier engineering services company providing turnkey engineering services primarily in construction and heavy equipment - will add to our domain expertise, in particular the powertrain technology.
Demand outlook: We are entering the growth phase of the industry and organisations are looking at doing all kinds of scenario analysis in anticipation of the actual growth. For instance, while foreign suppliers are focussing on the kind of product they can bring here, the Indian companies are looking at their exports. Besides, the western companies are exploring how to homologate or decontent.
"With the launch of Hamm rollers in India, we are catering to a wider segment of the retail market." - Ramesh Palagiri, Managing Director and CEO, Wirtgen India
Market outreach: We have a focused clientele. With the launch of Hamm rollers in India, we are catering to a wider segment of the retail market. From just six sales and service offices five years back, we now have 20 such offices all over the country and are able to reach out to various markets.
Expansion strategy: We recently expanded with a new manufacturing bay in our existing plant where we will produce pavers from this year onwards and the fourth brand of Kleemann. We expect the first made-in-India Kleemann product to roll out by January 2015 in Pune.
We will be able to sustain our leading market share with the new launch of dash 3 range of pavers. This new generation of pavers comes with a lot of features to give enhanced customer productivity, lower operating costs, better fuel consumption, etc. Also, we have recently introduced the Cold Recycler WR 240 in India, a new technology that is catching up fast.
Technology gap: The latest machines are already available in India. However, the question is of their right utilisation to get the required end results.
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