Indian Engineers cranes Industry May 2011 What are the major challenges faced by the Indian crane

e industry? After sales and support services is a big business overseas, but at nascant stage in India. Typically, each reasonably sized company in India has its own in-house general-purpose maintenance team that handles preventive maintenance as well as break down maintenance. Furthermore, relatively low manpower costs make it difficult to convince customers to take up AMCs. However, customers are slowly realizing the benefits of outsourcing the maintenance of their cranes to specialists, especially where cranes happen to be an integral part of their production process. We expect the services business to grow steadily in India. How over a period of time the company has been upgrading its products matching the best in the world and contemporary advanced system to provide reliable solutions to the management in the operation of cranes both in terms of emerging trends and global advancement? Please give brief view of some of these developments, which have been incorporated. In addition, ElectroMech also custom engineers cranes having high SWLs in excess of 100,000 kg specifically for the heavy engineering industry. Through our collaboration with Shuttlelift, we provide rubber-tyred mobile gantry cranes, which can lift loads between 13 tonnes to 1000 tonnes. Post sales service for cranes is an area we find several lacunae in the Indian industry. We also recently launched a new subsidiary, Cranedge a dedicated service organization exclusively for providing post sales service support for crane users. ElectroMech has entered into tie-ups with renowned companies to provide advanced technology solutions. Can you elaborate on the various JVs the company has formed till now? Do you plan to enter into any other alliance? To make sure that we can satisfy any hoisting need that our customers may have, ElectroMech believes in striking partnerships with global leaders in the industry. As a result, our clients ultimately benefit as they get world class products coupled with ElectroMechs excellent pre-

sales, execution and post-sales support. Our philosophy of bringing the best to the market means that our next new product could be around the corner. What has been the growth of the company in terms of volumes and revenue? How much do you target in next fiscal? In the year 2000, we were a small company doing an annual turnover of around `3.25 crore with around 70 people. Today, we have a turnover of almost `200 crore with around 500 people working for us. We have been steadily growing at a CAGR of about 55% each year. We are currently Indias largest overhead crane manufacturer by volume. We wish to become number one by sales. Can you brief us on your manufacturing units? Are there any plan to set up more facilities in other parts of the country or expansions of the existing facility in the near future? We have completed our second phase of expansion at the Pirnagut facility. We added (expanded) another 7,200 sq m with an investment of `15 crore to its existing facility, which was 10,000 sq m. Now the total covered area of the Pirangut facility is 18,000 sq m. Earlier, we were manufacturing 800-1,000 cranes in a year, depending on the product mixture. Now the production capacity is augmented to 2,000 cranes per year. In an endeavour to make the plant more efficient, we are investing substantially on automation in the area of fabrication, assembly line, etc. However, complete automation in our kind of industry is not possible. There has to be a mix of conventional system and sophisticated technology as well. ElectroMech has installed SAP as its ERP backbone to ensure all the functional departments are integrated and all the processes are tightly knit together. A state of the art automated stacking system ensures that all the components are readily available. All steel plate cutting is done on two sophisticated CNC Plasma cutting machines. A semi-automated Girder Manufacturing Line ensures that the box girders are manufactured in the shortest possible times with minimum errors and rework. This reduces the overall order processing time on the shopfloor and enables ElectroMech to churn out cranes at a high rate. A dedicated shot blasting

facility and an enclosed forced draught paint ensures high quality of finishing and long life of finished products. The outstanding feature of the factory at Pirangut is the way it is laid out. There is a provision for distinct flow of materials coming from inside of the factory. The first three bays of the factory act as stores and the last bay acts as a fabrication and finally the dispatch area. One might think that this is the standard way of manufacturing, but in the crane industry such an organised plant (which is available mostly in European countries) will not be seen anywhere else in India. The crane is a huge product, thus, is difficult to handle and cannot be put on an assembly line. Rather, the product has to be accommodated in a place where all components are available and accordingly assembled on the products at that particular location. This is unlike assembling of automobile. Any other recent developments that you would like to share? MotilalOswal Private Equity Advisors have invested `45 crore in our company. The outlay have been raised for funding our growth plans. Furthermore, we also are looking at expanding our market base across several different geographies and substantially scale up our operations.