Diversification is a part of the mission of this company from its very first day

Dr SK Nanda, Chairman & Managing Director, GSFC Ltd, was in Mumbai to launch GUJCON PRF & CRF, a new product for the infrastructure industry. IT caught up with him to get his insights.

Tell us about this latest product.
These are virgin Nylon-6 fibres for secondary reinforcement in construction. Nylon 6 is the best proposition among all synthetic fibres to impart the most effective secondary reinforcement in construction and we have got the patent for the process of making this product. The entire process route has been patented. Once people discover this, there will be an exponential growth. No one wants a home with a leaking roof, peeling plaster or without a crack-proof wall. I am sure this will not be less than Rs.200 crore within the next two years. We have priced it low as we want to give out the message that this company is interested to contribute to building your homes and the nation´s roads.

There is no one else with this product so there is also no danger of competition from China for a low-end version! There´s only Belgium and the US where this is used which is why their roads are so good. We are now giving you the same thing. It is new in India and needs to be communicated well.

Will this product help in reducing the number of potholes?
Yes. This will reduce the micro cracks and brittleness of the concrete. Water permeability will be reduced by more than 75 per cent. It will enhance the absorption capacity of the structure. Flexibility, strength and toughness will be improved and tensile strength also enhanced. All these benefits will result in an improvement in the life of the structure.

What is your production and what will be the inflection point for scaling up?
In terms of production, there isn´t any problem.
If 5,000 tonne is needed tomorrow, we can cater to it. Currently, we produce about a thousand metric tonnes. However, this is where the planning fails.

If I add up 3 lakh km of road and a certain amount of cubic material required in houses and so on, and we produce according to that, we can get into a loss. We will not get into these conjectures. Suffice to say, we have the capacity to increase from the current two lines of production to six lines of production. If I am producing 50 tonne per day, I can increase to 200 tonne or more per day. Forward integration can always be done and we have that flexibility. The availability of the product is good with a widespread dealer network in most states.

What is your strategy to help the product gain traction?
There are two ways of pushing the product. One is the hardware stores. The second is the cement industry as well as the galaxy of architects and builders who design and build. They are the ones who tell the people what is good and what is bad. Once they discover the strength in this proposition, surely they will be able to advise their clients about it.

The universities will also now be involved. The technical faculty will be involved. In fact, they already are. The practitioners, i.e., the civil engineers will understand through word of mouth. There is no target. In any case, we already have our foreign offices ready even before selling in India. As of now, this product has already shipped to countries like Burma and South East Asian countries. Sri Lanka is also in the run for it. The Indian market is going to emerge gradually.

The government agencies and institutions are a part of the entire process of the approval and the regulation.

In the process of launching, automatically, will be spilling over to civil society. Once this happens, there will be a demand and retailing will be done accordingly. This is something new and people do not know about it yet.

What is the kind of involvement of government agencies and institutions?
To start with, the R&D was by us. The product came next and then the patent. After this, we applied to several government institutions like the National Highways Authority of India (NHAI), Indian Roads Congress (IRC) and others. These are the institutions that test and question you and conduct the trials of the product. When they see the product is doing well, then they recommend its application. Our product has found favour with both NHAI, the Roads Ministry and the Defence Ministry is also evaluating it.

What was the thinking behind introducing this product in this niche area? It´s not part of your core business.
This company, unlike any other company in the fertiliser segment, has never been a mono company of fertiliser. We have been in fertilisers, industrial products, nylon, melamine and have now ventured into infrastructure. We are present in the areas of drip irrigation for farmers and solar products. We also have the biggest windmill in the state. Suzlon has a presence in the state because of us. We own 180 MW of power. We use the wind power ourselves. We also have a university and a commendable CSR programme of providing two lakh children a midday meal daily, free of charge.

We are for every segment of the people, not just for the fertilisers sector. There is no money in fertilisers, to be honest. We don´t have margins there.

Hence the need to diversify?
Diversification is a part of the mission of this company from its very first day, ever since it started after the bifurcation of Maharashtra and Gujarat in 1960. The company started in 1962. RCF remained with Maharashtra and stayed only in fertilisers. This was the beginning. We went into industrial products, sulphuric acid, melamine, benzene, caprolactam, nylon products, polymer products and other things. We have a number of products in which we are the only manufacturers in the country, whether you take melamine, caprolactam, or anything else. GSFC has various firsts in its history. We have always taken products in which we will be unique. We were the first to come out with water soluble fertilisers. We always come up with unique products and this one is for the infra and building industries.