PRD Rigs is a leading manufacturer of drilling and exploration rigs. Today, as the market demand is growing for the mining and construction equipment, the company has began to diversify into a wide range of drilling machinery for the mineral exploration and geo technical markets.
T.T. Paranthaman, Managing Director, PRD Rigs India in an interaction with Sandeep Menezes says that the equipment market will grow at least 30 to 40 per cent particularly in mining segment.
Excerpts from the interview:
How do you foresee the equipment market growing after the elections?
Currently equipment market is witnessing a downward trend. But after the elections we feel that the market will grow at least 30 to 40 per cent particularly in the mining segment. But, we feel that once the election process is complete, it will take another six to eight months for the equipment market to start witnessing the growth.
What has been the impact of Rupee depreciation on the equipment segment?
It has not affected PRD Rigs much as far as the domestic market is concerned. Most of our products are totally indigenous except for few parts. Due to the Rupee depreciation PRD’s export growth has been strong at nearly 20 per cent. Currently around 80 per cent of our revenues are from exports, while 20 per cent revenues are from the domestic market.
Around 90 per cent of equipment sales are routed through funding from financial institutions. How has the recent hardening of interest rates affected the equipment market?
Earlier we used to only do the mounting. I mean the truck comes and we mount the machines onto the trucks for water drilling solutions. Now we have come up with this crawler mounted version, where the entire machine can be sold as a single unit. We have also approached various financers for approval.
Currently, the equipment market is witnessing negative growth of around 15 to 20 per cent compared to last year. How has PRD fared vis-à-vis the industry?
We have fortunate enough to sell more machines as we have a wide network service and personal care taken. Also our company has a very strong presence in Africa. We have two companies out there—Ghana and Kenya—for taking care of service. But water solutions drilling machines will be more needed in Africa, since it is a fast developing area.
What is the quantum of trained equipment operator shortage across India?
PRD’s water drilling segment was started around 40 years ago. We help the customers by sending operators for operating the machines. We are planning to train more people and thinking of starting an institute for training in drilling technologies. There are plans to start a drilling institute in Tamil Nadu.
How much growth do you foresee in the drilling segment?
There is lot of scope in India as a huge investment is allocated for infrastructure projects. Under this road sector takes a major role with road projects having a major share. For this geo-technical investigation is required which needs drilling. Then to build roads also drilling is required. So, we are hopeful of ample opportunities.
Throw some light on PRD’s R&D initiatives?
Currently, we are investing almost 10 per cent of our revenues on R&D initiatives. We are trying to advance pneumatics into hydraulics.
Most Indian customers look at initial costs rather than life-cycle costs. Comment.
The costs of imported machines are very high. The labour and production costs are higher abroad, therefore imported machines are expensive. We, at PRD, with our knowledge and technology in drilling rigs are trying to make it affordable to customers.
What is PRD’s future business strategy?
Since we are already strong in water drilling solution, PRD is now diversifying into mining and geo-technical exploration. We are targeting around 40 per cent growth over next five years due to our mining segment equipment. The initial aim is around 10 to 15 per cent growth per annum.