Schwing Stetter India, a 100 percent subsidiary of the Schwing Group of companies GMBH, is a pioneer in the Indian concrete construction equipment industry catering to the Indian market with world-class concrete construction equipments.
V. G. Sakthikumar, Managing Director, Schwing Stetter Sales and Services Private Limited, talks exhaustively on the company’s products and facilities while sharing his concerns on how the recent demonetisation, though good in the long run, will affect in the short term due to changed scenario in the liquidity in an interesting conversation with
EPC&I.
As an established leading player in the Construction Equipment market in the country, what is your opinion on Infrastructure development activity in the country? While some research analysts and economists claim that it is skewed more towards road building activity, development of power plants, ports, airports, etc continue to lag behind. Do you subscribe to this view?
Yes, we have been viewing the growth which is skewed more on road building activity. 2016 is a very good year for projects in roads and highway sector in India. It has offered substantial sale of batching plants for concrete road construction in India.
With respect to the new road projects upcoming in India, it is not only time bound, the customer looks for equipment which are easy and fast to erect and also to dismantle, assemble, transport and erect from one side to another.
We see some gap in our product range with respect to concreting village roads, and we will be soon adding up newer equipment to fill this gap. However, our Self Loading Mixers playing a vital role in concrete road construction in many villages.
Schwing Stetter India offers concrete batching plants for concrete road construction. Concrete roads, not only for national highways, but also for state highways, district roads and village roads.
Apart from such high capacity batching plant for making rigid pavement, we also offer concrete batching plants for general development like construction of Road Over Bridge, bridges across rivers, retaining walls, culverts, curbs, etc.
These equipment include concrete batching plants, transit mixers and concrete pumps including truck mounted boom pumps, in places where the roads pass through hilly terrain and construction of tunnel is inevitable. Our shotcreting machines are very useful in holding the tunnel immediately after the excavation.
What would you say are the main growth drivers in a highly competitive market?
The main growth drivers in a highly competitive market are innovation, productivity and growth. Also speed, scale and skill needed in a project to be executed determines the sale of equipment.
How have the policies and initiatives taken by the government to develop the country’s infrastructure reflected on your company’s growth?
For a long time since 2012, Schwing Stetter India was experiencing a sales curve which was very flat, but 2015 was a growth year for us. We grew by 11 percent in 2015 and 20 percent in 2016, which is also a growth year. This was possible only because of the policies and initiatives taken by the government in reviving the infrastructure.
What are the company’s expansion strategy?
We will be inaugurating a facility for Self-loading mixers soon. Apart from concrete machineries, we have also introduced Tower cranes, Wheel Loaders and Motor Graders and sludge pumps in the past two years.
Our four manufacturing plants of 10 acres each focussed on Concrete Pump, Batching plant, Concrete Mixers, Concrete Boom Pump production facility is located near to Chennai, in Irungattukottai, Kancheepuram.
Concrete pump production facility was commissioned in the year 1999. It has the most modern production line with latest machineries and a production capacity of 200 concrete pumps of different variants per month. It is supported by state-of-the-art paint booth, hydraulic assembly line and a testing bay.
Truck Mixer production facility was commissioned in the year 2004. It has a production capacity of rolling out 400 concrete mixers of different variants per month. This unit boasts of Plasma cutting machines, CNC rolling units, a fully automated shot blasting unit and a robot welding machine.
Batching plant production facility was commissioned in the year 2006. This unit is huge to produce all sizes of batching plants. It is supported by an in-house fabrication unit, Plasma cutting machines, break presses and an own electronics and automation unit to design custom made electronic unit for batching plants. It has a production capacity of rolling out 100 batching plants of different variants per month.
In March 2012, the company inaugurated its fourth facility for world class boom pump production to support the three existing manufacturing facilities growing demands. We have introduced line production in our unit this year. In the last year, we have added more products which are useful for concrete road construction like M30Z Batching plant, Self- loading mixers SLM 4000 and SLM 2200.
In the face of aggressive competition putting strong price pressure, coupled with the liquidity in the market which will impact cash flow and profitability, what are the transformations that leading companies such as yours need to bring about to ensure that you not just grow at a predetermined rate but grow substantially?
Indian customers prefer equipment which delivers high performance, and they also expect good after-sales support. Once it is established that the products are meeting these conditions, they will not mind paying higher price.
Customers who buy only on low prices have realised over years that low price alone will not help in executing projects competitively and meeting timely deadlines. Schwing Stetter India has been constantly innovating products to address niche requirements of customers which helps us grow substantially and we will continue to do that.
How do you ensure installation flexibility?
I presume this question relates more for concrete batching plants which requires installation time. We are offering batching plants without foundation, thereby cutting installation time and also installation cost. That means, customers who are shifting the plants very often are bound to save both time and money with such mobile foundation less plants.
How is the technology placed to suit Indian requirements taking into consideration that the equipment works for extended duty cycles and adverse conditions within the country?
Schwing Stetter products are designed in Germany where the typical approach is to design a product taking it for granted to build the products with long service life and continuous duty cycle. These attributes actually costs the products more. Therefore, the products are expensive compared to products designed in other countries.
Schwing Stetter India manufactures equipment designed in Germany and cuts substantial costs with indigenised components and assembly cost. Therefore, we are in a position to offer products to customers without compromising the basic attributes of a German product.
OEM support and cooperation for future product upgradation is important. How are aspects like prototype performance assessment in varied working conditions being addressed based on the emerging requirements of the Indian customers?
Most of the component manufacturers based in Europe and America are setting up their manufacturing facilities in India, and are in constant dialogues with us, offering competitive priced components. This helps us to meet our cost reduction targets, thereby helping customers to get products at a competitive pricing.
What would you say are the primary challenges going ahead?
The recent demonetisation is going to be good in the long run, but in the short term there could be postponement of purchases or investments due to the changed scenario in the liquidity. We also expect the GST implementation in April to put the system out of gear during the implementation phase. Together, GST and demonetisation can potentially bring down the sales for the next six months. We expect things to improve tremendously after that.
What is your forecast of CE demand in the days ahead?
In India, over the next few years the “Earth Moving and Construction Equipment (ECE) is expected to grow at a tremendous CAGR of 20-25 percent. Currently, ECE market accounts for only $3.0-billion, but its growth potential is more in the near future, such that the market would be around $16-20-billion by 2020. Indian ECE market has the greatest capability to grow at 20-25 percent to reach 330k-450k unit sales by 2020 wherein concreting equipment is to grow at a CAGR of 15 percent annually.
Lastly, any new products and services expected to be launched at Bauma Conexpo India 2016?
In Bauma Conexpo India 2016, Schwing Stetter India will be launching a slew of new products. These products are for different needs of construction like batching concrete, transporting concrete, pumping concrete, recycling concrete and shotcreting concrete.
But, this year, we will be specially addressing the key focus areas of government of India in the area of Clean India or Swachh Bharat and Skill India. Towards those goals, we will be displaying Smartec sludge pump, which will be of great help in projects like cleaning of Ganga, metro rail construction, waste water management and smart cities.
Similarly, our training simulators will offer opportunity to the operators to move onto virtual experience and simulation to train them in safety and operation of concrete boom pumps. This will be a one step forward compared to the current learning with the graphics.
Also, we will be showcasing a Heavy duty stationary pump SP 4507 for the first time. SP 4507 is a new development for the present trend of high rise pumping requirement especially in growing real estate markets like India and abroad.
This new age pump bridges the gap between SP3800 and SP4800 capacity pumps. This will cater to high rise segment where the present challenges of pumping the mix with stiff consistencies at a faster rate to around 300m vertical.
SP 4507
· The pump develops 203 bar pressure on concrete and delivers an output of 54m3/hr in high pressure configuration.
· The pump kit and rock valve of the SP 4507 each have their own hydraulic circuit. It helps to handle high grade mix. The full power of the pump kit will be available - regardless of the switching movements of the rock. This ensures a quiet pump behaviour, high pumping capacity and protection of the components with less vibration.
· The new generation ‘rock’ comes with high efficient energy transfer on the concrete.
· New operator interface and emergency pressure release system will ensure safe operating environment.
Schwing will also be launching a slew of products such as:
· Recycling plant RA20
· 5 tonne external climbing flat top tower crane XGT T80
· Wheel loader LW180K
· Motor grader GR 150 II
· Truck mounted crane QY85KA-Y
· Piling rig XR130E
· Crank arm type aerial lift platform GTBZ14J
· Crank arm type aerial work platform GTJZ08
· Horizontal directional drilling machine XZ450 plus.
“Together, GST and demonetisation can potentially bring down the sales for the next six months. We expect things to improve tremendously after that.”
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