We hope to achieve 10% growth this year: Tata Hitachi – ET Infra

Sandeep Singh, Managing Director, Tata Hitachi

In conversation with ET Infra, Sandeep Singh, Managing Director, Tata Hitachi talks about the construction equipment sector, its future and his company’s growth. Here are the excerpts of the interview:

How is the domestic industry poised to tackle China?
There are three Chinese companies that are present in India and we are okay to compete with them on pricing and other parameters. Their machines are technically not as sound as our machines and the problem is when they go overboard on commercial terms, which are not possible by any Indian manufacturer like giving standard credit or pricing below the material cost.

However, the China market has slowed down in the last few years and the decline has been significant in the last year i.e. 30%. They are trying to dump their machines in Southeast Asia, India and other parts of the world, wherever it is possible. That is where the concern is.

Besides China, are there any other challenges that the domestic equipment industry is facing?
We have an interest rate going up in the market, we had steel prices rise up to 35% two years back. Though the prices have tapered down by 10-15% but they are still very high and they have in turn raised the price of the equipment. We import 35% of our kits from Japan or other parts of the world and the Rupee has depreciated and these are the things that are impacting the overall pricing of the equipment. The component prices have gone up by 8-10%.

What is the growth target for FY’24 for your company?
Last year, the domestic industry grew on an average 15% because last year the industry grew at a low base. Post Covid, the equipment sales were not so high and this year we are looking at 8-10% growth, which we believe is quite good and in Tata Hitachi we hope to achieve close to 10% growth.

What are your capex plans for FY’24? Which are the segments you will be targeting?
This year we are looking at anywhere between Rs 200 to Rs 300 crore. Our capex is not majorly on capacity but basically on introducing more products and bringing in more automation in the plant and replacing some of the old machinery. We have excess capacity and currently we are using only 70-80% of that capacity but we are introducing some new models because of which we are looking at this capex.

How is the company going to leverage the Union government’s NIP or National Infrastructure Pipeline plan?
NIP is the major demand driver because 50% of the NIP is being spent on roads, railways, irrigation, water and sanitation and these are all big demand drivers for our industry, so we are dependent on this.

Do you have any products to cater to the NIP?
We are refurbishing our product portfolio as the market is expanding. We are also working a lot on customized machines essentially for car scrapping and that is where we are investing.

  • Published On Jun 29, 2023 at 07:29 AM IST

Join the community of 2M+ industry professionals

Subscribe to our newsletter to get latest insights & analysis.

Get updates on your preferred social platform

Follow us for the latest news, insider access to events and more.

Source link

Leave a Comment

Your email address will not be published. Required fields are marked *

Open chat
How May I Help You.
Scan the code
Vishwakarma Guru Construction
Hello Sir/Ma'am, Please Share Your Query.
Call Support: 8002220666
Email: Info@vishwakarmaguru.com