The Hindu Business Line : Schwing Stetter rides high on construction boom

Chennai, Jan. 16 Schwing Stetter (India), the German-owned company that manufactures ready-mix concrete making machinery, expects a 50 per cent jump in turnover in 2008, thanks to the booming construction industry.

In 2007, the Chennai-based company produced 4,500 units of equipment and achieved a turnover of Rs 800 crore.

Towards higher capacity

“We are seeing a trend towards higher capacity machines,” says Mr Anand Sundaresan, Managing Director of the company.

Schwing Stetter is also getting more orders for the “240 cubic metres”-giant machines costing Rs 3 crore a piece that can mix and pour concrete at the rate of 240 cubic metres an hour.

Using this, a one kilometre, 6 metre wide road could be laid in eight hours.

Apart from demand from within India, the German parent has also been asking if the Indian subsidiary could produce for markets outside India, Mr Sundaresan told Business Line recently.

Mulls expansion

Schwing Stetter is scouting for 100 acres of land and wants to add at least 300 people to its existing workforce of 1,100.

Moreover, when the company starts producing more, the scale provides an incentive for further indigenisation.

The machines that Schwing Stetter (India) produces cost between Rs 8 lakh and Rs 13 lakh.

They have a local content of 70 per cent. Today, the company mainly imports hydraulic pumps.

Mr Sundaresan reckons that it is possible to raise the indigenisation level by about 20 per cent.

He feels that it would be easy to start producing cylinders for hydraulic pumps locally and then move on to the other parts of the product. But all the cylinder manufacturers are “overbooked”.

Mr Sundaresan said the company was looking for land near its existing plant at Irungattukottai — close to the Hyundai plant.

The company’s first choice for the expansion project is Chennai, “where we have created a vendor base.”

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