Pradeep Kathuria, Head, Heavy Equipment Bank, Essar Projects tells us why an equipment bank adds immensely to the efficiency of an EPC contracting company.
Essar Equipment Bank (EEB) has fleet of sophisticated equipment in the construction industry having latest technology equipment from renowned original equipment manufacturers worldwide in its global operations. The total fleet value of equipment is approximately US$ 400 Million, over 5,000+ in Numbers.
EEB is involved in selection-procurement-deployment-operation-maintenance of equipment thereby providing complete solution to the equipment management. EEB has highly skilled and motivated team for carrying out operation and maintenance of these equipment ready to deliver at the toughest environment.
EEB provides these equipment to the project or from the market (hired) as per the schedule. Once the projects are completed, the equipment are de-mobilised for complete overhauling at our workshop and then again re-allocated to the new projects. The basic purpose of this equipment management is to ensure there is a less idling by attaining the optimum availability of the equipment and maximum utilisation.
These equipment are maintained at our workshops located at Hazira and Vadinar. Shortly, we will have a central workshop at Nagpur which will be full-fledged model workshop capable to handle any major or minor repairs. This is followed up with regional workshops at various strategic locations.
Indian construction equipment market is more than Rs 20,000 crore worth of equipment every year, out of these, over 90 per cent is bought by the infrastructure companies and the rest are being sold to rental companies.
EEB has a technically experienced procurement team located centrally at Mumbai. This team actively participates in the selection of equipment in consultation with concerned project team. This team explores techno-commercial aspects and finalise the procurement strategy for buying the list of Assets. This procurement team also ensures the right product mix, standardisation of equipment for operational ease. This team also ties ups with OEM for extended warranty and Annual Rate Contracts to ensure firm services and spare parts availability at all the project sites.
Essar has an advantage that their own Essar Logistics Limited (ELL), a major logistics company specialised in all types of logistics requirements such as Road, Air and Sea routes. In addition to logistics support for the Essar Projects consignments, ELL has a specialised dedicated team for logistics solutions for equipment movement. ELL ensures smooth logistics services in-spite of difficult and different formalities in various states legislation, formalities for crossing the border, octroi, sales tax obligations, etc.
These movements are for new equipment deliveries or old equipment site transfers. For new equipment deliveries, ELL arranges deliveries from across the globe. These equipment mainly comes from USA, European countries, China and Japan. There are some domestic manufacturers and vendors who primarily have a tie-up with international companies and they assemble/manufacture equipment in India up to certain level of capacities.
In China, the domestic consumption of construction equipment are very high, which is the reason for having large manufacturing base, whereas in India, until early 1995, the demands were not high and domestic production was sufficient. Now, due to huge demand in terms of volumes and technology, the things are improving and most of the foreign manufacturers are setting up their plants here in India.
Today, thanks to the infrastructure boom in Power Plants, Refineries, Steel Plants, Mining, Infrastructure and Roads, etc, Cranes (Crawler Cranes, Mobile Cranes, Pick & carry Cranes, etc) are the backbone of most of the projects. The earthmoving equipment (Hydraulic excavators, Dozers, Backhoe Loaders, etc), Concreting (Concrete Pumps, Transit Mixers, Concrete Placer Booms, etc), Power Generation (DG Sets), Road Construction (Pavers, Hot Mix Plants, Tandem Rollers, etc) are the other major equipment categories are in Demand,
The rental companies in India are still largely in unorganised sector, of late global players are making their presence along-with some Indian players in the organised sector.
Still for the construction companies it is their own fleet which are supporting their projects. Companies like Essar have this advantage in executing projects in availability and cost-efficiency for deployed equipment.