“Operating With Focus”

As the unexpected calamity of COVID has hit all the politics and markets of the world, we would like to know your expert views on the current market status and the way you are planning to combat the current pandemic scenario? 

The recovery of demand is most likely after Sept but will depend on many other factors such as workers and operators returning to work post-lockdown, financers agreeing to lend, construction activities gaining pace, realization of payments etc. The demand is expected to remain subdued for at least 2-3 quarters before rebounding. Komatsu, Scania and L&T are geared to meet the requirements and do not expect any supply chain issues. We are focusing on after sales support to the customers. Our service teams are already active and rendering service and supplying parts across India wherever machines are operational, which will continue. Our Dealers too have been fully supportive in the field. All our Service Centres are also operational.

It is said that the present economic condition is of a ‘V’ shape where the economic slope goes down immediately due to unavoidable situation and emerges as soon as the problem vanishes because the workforce returns to the job and the situation comes back to normal in just a few months. How far do you think that this concept will prove to be fair and workable for the Indian infrastructure and construction market and to your business ambitions?

As already explained, demand revival will depend upon multiple factors, most important will be finance availability and payments from government. We expect both to remain subdued during the current FY and may ease only next year. Hence, we expect a more gradual recovery instead of V shape.

Is there is any new plan or strategy which you are planning for remaining competitive in the coming months and how do you forecast your business dealings after the market emerges to again run on the track of moving on and gaining some momentum?

We are reviewing all our processes and cutting down on non-value added activities. Big focus will be to shift business processes and activities on e-platforms. This will not only improve efficiency and productivity but will save cost. We are also focusing on optimizing working capital. A lot of effort has gone into upskilling people during the lockdown, which will help us in gaining competitive edge when the demand revives.

What are your current or forthcoming projects which you are working on and how are you managing the execution of them in a positive and practical manner?

In terms of Product Development, the next level emission norms Bharat Stage VI for construction equipment vehicles would be effective from Oct’ 2020. While we are closely working with Engine OEMs, sudden lockdown due to COVID crisis has become a serious impediment to meet the deadline. The engines and machines were under various stages of testing and trials when lockdown was declared. These efforts will have to restart after lockdown is completely lifted. Going forward, we expect a rush to get the equipment and engines certified from the authorized agencies such as ARAI. Hence, it will be extremely difficult to meet the deadline and we hope authorities concerned appreciate the industry concern and extend the deadline.

We also have some new products on proto-trial stage, which shall be commercialized soon.

When it comes to being one of the market leaders, how are you researching on management’s organization and keeping yourself motivated during the COVID phase?

Covid19 has certainly brought in real challenges for the CE Industry. But we do believe that GoI is focused on Infra development. They recently announced 100 lakh crore National Infrastructure Pipeline which is to be completed by 2025. NHAI is targeting to award 4500 km of highway contracts and plan to increase construction rate from 30 km per day to 60 km per day. Several projects in the infrastructure space in Roads & Highways and Ports & Airports are eagerly awaiting for a take off. All this will help revive CE demand and we are hopeful that govt will find resources to invest.

What expectations you have from the government’s plans and reforms to uplift and improve the overall condition of the Indian infrastructure and construction market?

The Central Government has already announced 20 lakh crore economic stimulus package. Though large focus is on credit support to businesses, it will certainly aid revival. As mentioned, MoRTH has also been assuring of increasing the pace of road construction activities under various agencies like NHAI, NHIDCL and schemes like Bharatamala, Sagarmala, PMGSY, Chardham etc. Further, there is a huge National Infra Pipeline worth 100 lakh crore to be completed by 2025. Hence, we are confident that if all these projects are implemented as assured, construction equipment demand will soon rebound and start growing. Hence, implementation is the key. Quick transmission of stimulus will motivate Banks and NBFCs to get more active in lending to quickly revive the construction sector.