Aim To Be $1 Billion Entity By 2020: Sany India
Sany Group is the sixth-largest heavy equipment manufacturer in the world, and the first in its industry in China to enter the FT Global 500 and the Forbes Global 2000 rankings
Sany Group, a leading Chinese manufacturer of construction, heavy machinery and renewable equipment, entered India in the year 2002. It is the sixth-largest heavy equipment manufacturer in the world, and the first in its industry in China to enter the FT Global 500 and the Forbes Global 2000 rankings. In an interview with BW Businessworld, Deepak Garg, Director & CEO, Sany South Asia & Sany Heavy Industry India, said that the Group will be clocking a turnover of $1 billion by 2020.
When did Sany enter India and what has been its journey until now?
We started in India in the year 2002 by importing Concrete Equipment, which were used for constructing large size towers, from China. After a period of five to six years, we launched a slew of products such as truck and crawler cranes in the domestic market. We continued to expand our product portfolio in the concrete equipment and crane segments. We finally established our manufacturing facility in Pune where we started with the local production of concrete equipment. We also started making excavators and cranes in the next phase. Over the last seven years, we have introduced a full range of equipment for various applications in the country. Apart from the aforesaid products, we are also selling earth moving and mining equipment in the country. We have also launched all-terrain and rough terrain cranes and have brought in port and road handling equipment. At present, nearly 50% of our revenues are derived from the excavator segment, followed by cranes at 25-30 per cent, concrete equipment at 10 per cent and another 10 per cent from Port Equipment.
How important is the Indian market for Sany globally?
India is one of the core markets for Sany Group globally. It is one of the rare economies in the world which is growing at a record pace and is very similar to how China was growing 20 years back. Based on these factors, our Group is quite buoyant about that and is enhancing its product lines and beefing up its manufacturing presence in the country. The major growth drivers for us and our industry per se would be a boom in key sectors like Infrastructure, Roads, Railways, Aviation, Metro, Defence, Aerospace, etc. We are already an export hub for Africa, Middle East, and South East Asia. Nearly 20 per cent of our global revenue is generated from exports.
How much has the company invested over the last 15 years?
On the manufacturing side, we have invested Rs 500 crore. Another Rs 100 crore was spent towards our distribution network. Another $100 million will be spent on building a new production line for new products like batching plant, motor graders, mining equipment, etc. We will also be expanding the annual output of our earthmoving equipment. We have also forayed into wind energy and will be pumping in close to $2 billion as capex for this vertical.
There are quite a few well-established construction equipment manufacturers in the country like JCB, Caterpillar, Escorts, BEML, Komatsu, Doosan, ACE, etc. What is the key USP of your product lines?
We have India-specific technologies for every product range that we are selling here. In the excavator domain, we have certain products for specific applications. For example, we have a 21-tonne excavator which determines 60 per cent of the overall market in India. So we have a specific product with a specific engine and with specific hydraulics for the Indian market. We are already the market leader in Crane segment, second largest player in Piling Equipment segment. Our next step is to get advanced GPS systems integrated with such products. Parallely, we are also working on technological advancements in order to comply with Tier-IV emission norms (by 2020). In the mining space, we have brought in the most efficient excavators in the country. These are 45 tonne and above excavators which are assembled at our manufacturing facility in Pune. We also got an encouraging response from SRT55 Dump Truck for mining applications. Although these kinds of machines already existed before, we managed to literally disrupt the market by creating newer benchmarks. We also managed to create similar benchmarks in the Crane segment. We have executed a mammoth order from JNPT for (supplying) Rubber Tyred Gantry (RTG) cranes. Not only all our products are technologically superior to others because of being fuel-efficient, we also have an impressive distribution network. I am confident that we will be among the top 3 players in the domestic industry.
How many units have you sold in the Indian market?
Cumulatively, the total number of Sany equipment that is working in India is 7,000 units. In the last CY, we have sold 1,300 equipment and are looking forward to selling 2,800 units this year. The volumes of excavators are doubling on a YOY basis. In fact, we are the fastest growing company in the excavator business. While the overall market grew by 40 per cent, we grew by 100 per cent. Because of our better technology, we could outperform the market.
What is the annual capacity of your manufacturing facility?
We have announced the 4,000th machine rollout early this year. With the current infrastructure and manpower, we can churn out close 3,000 machines per annum on a single shift. We are planning to double this capacity by June next year. At present, nearly 600 people are employed directly and 2,000 people are employed indirectly through our Chakan, Pune plant. We look forward to employing 10,000 people from this facility in the next three years.
What is the company’s current and projected turnover?
The Sany Group’s revenues from India were close to Rs. 1,000 crore and this year we could earn Rs. 1,600 crore. We want to be a billion-dollar entity by 2020. Even though the construction equipment vertical will account for a major chunk of the business, we expect some contribution from the wind energy vertical also. Even though the contribution from India is just 2-3 per cent of our global operations; it will surely go up to 8-10 per cent by 2020.
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