BEML Limited is a leading public sector company under the Ministry of Defence and a premier indigenous manufacturer of earthmoving equipment for over four decades.
A. K. Halder, Executive Director (Marketing) – BEML Limited told Sandeep Menezes that the company plans to launch the 190 tonne capacity dumper next year.
Excerpts from the interview:
The construction equipment market is currently not witnessing any growth. But post elections, how do you foresee the construction equipment market growing?
We are all waiting for the market to improve. The ‘Excon 2013’ event held at Bangalore would certainly pave way for the growth with a more number of visitors and exhibitors participating. In the long-term, the market will definitely improve.
The quantum of future growth can’t be predicted now because there is a slump currently and market is not moving as expected, but the future will definitely be better.
How has the Rupee depreciation impacted the industry, BEML in particular?
On the whole, BEML did not face much impact due to Rupee depreciation. In the construction equipment segment, there has been a drop in sales but that is getting compensated in other areas. But on the whole in terms of turnover, it has not gone down.
We are getting revenue from mining equipment, one need to understand that mining equipment have higher value while construction equipment need to have higher quantum to reach the same value. Therefore even with less number of mining equipment sales compensates for the drop in construction equipment sales. Also, we have business in rail and metro where BEML is getting huge orders.
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?
Definitely the impact is seen in the construction equipment market with the individual contractors or small customers who have taken loans are being affected. But, in the mining sector, purchases are done by the government sector mostly or big institutions. So, there is no need for financing as the customers themselves pay for the equipment.
Does being a PSU give BEML an advantage vis-à-vis other OEMs in terms of governmental orders?
Not at all. Look at all the purchase policies there is nothing that favors the public sector. The company has to be L1 in the tender and then only gets the business.
Raw material costs are rising while the market slowdown is not allowing manufacturers to increase prices. Comment.
There is pressure from customers to reduce costs. If one has to survive in the market, he has to reduce costs; there is no other way to it.
Currently, there is a huge shortage of trained equipment operators. Being a PSU and leading manufacturer in the construction equipment sector, tell us about BEML’s initiatives to train operators?
Whenever BEML supplies any equipment, we provide operations and maintenance training. It is part of our sales deal with customers but we are not separately recruiting operators and providing to customers.
Can you throw light on the quantum of equipment operator shortage facing the industry?
There is a shortage of trained equipment operators but it is for the user to take care of the situation.
What is BEML’s long term growth target? Do you have any new products being launched?
We also have a growth strategy but it is a combined strategy and not simply just for construction equipment. Our target is to grow minimum 10 per cent next year.
We have launched new products for the mining sector like the 150 tonne dumper and 180 tonne excavator. Further we plan to launch 190 tonne dumper which will be launched