The Hindu Business Line : Leighton sees tremendous scope in India

Scorecard
The company completes Nokia's mobile handset manufacturing plant near Chennai.
It is constructing a plant for Salcomp, a mobile handset charger manufacturer, and one for Motorola, both near Chennai.
It expects to start constructing an IT park near Mysore in the next few months.

Mr Simon Chivers, GM-Building, Leighton Contractors (India) Pvt Ltd

Chennai May 7 Mr Simon Chivers greets you warmly in the waiting area of his office and escorts you to his room. The first thing you notice is a white writing board on one of the walls. Ask him about it and he will tell you that he is learning Tamil.

Sentences such as "speak slowly" "I need to go to the office" and words such as "why" and "sugar" with their Tamil equivalent also written in English are on the board.

Who is his Tamil tutor? "Principally my driver," replies Mr Chivers, General Manager - Building, Leighton Contractors (India) Pvt Ltd, the Indian subsidiary of Leighton of Australia, a leading project development and contracting group. He even speaks a few Tamil words for your benefit. Leighton has built industrial plants worth $160 million near Chennai alone and is negotiating for a few more.

Mr Chivers, 48, who has been in Chennai for more than a year, says he is keen to learn Tamil, and will be more comfortable with the language once he has learnt the letters of the alphabet. He has travelled to more than 70 countries, lived in England, Australia, and New Zealand before landing this job in India. He speaks Arabic, French, German and knows Greek too.

India is an exciting place to be in, he says. Both professionally and on a personal level. His four children have visited him and enjoyed their brief stay here.

On a professional level, he is confident that economic growth will continue in India for another 10-20 years. And, that is why Leighton, which specialises in executing building projects from design to completion stage to tight schedules, sees tremendous scope in the country.

Leighton completed Nokia's mobile handset manufacturing plant near Chennai, as also Flextronics. It is constructing a plant for Salcomp, a mobile handset charger manufacturer, and one for Motorola, both near Chennai. The company is concentrating on industrial projects, IT parks - it expects to start construction on one near Mysore in the next few months - residential projects and hotels, but expects its project portfolio to widen.

Ongoing projects

According to Mr Chivers, the company has completed $160-million worth of projects near Chennai, and is executing projects valued (for Leighton) $400 million in various sectors, including highways and refinery projects, in the country. Besides, projects valued at $250 million are in the negotiation stage, including hotels in Bangalore and Chennai for a leading global chain.

Leighton's speciality, says Mr Chivers, is the speed with which it executes projects. And, that comes because of its in-house expertise in designing projects and managing them till completion, attributes that its industrial clients want. Most of its industrial clients in India are international companies that are aware of the Australian company's capabilities.

Tight deadlines

Leighton, according to Mr Chivers, is 5-10 per cent more expensive than Indian companies, but makes up for this with its ability to finish projects to extremely tight deadlines. Very few Indian companies have this capacity, he says. By how much can it compress a project completion schedule? Local companies, barring a handful, take up to 20-50 per cent more time, he replies.

The higher cost is due to three main factors - the number of expatriates that the company employs, higher safety standards and higher level of mechanisation. Over the next few years, the number of expatriates that Leighton employs in India will come down - it is already down to four from 15 a year ago and over the next three years will come down further. This will cut down costs by at least 5 per cent, says Mr Chivers.

The company's operations in Chennai have grown over last year. It now employs about 60 people, of which about 40 will be involved in designing projects and the others in administration and accounts.

Beginning next week, Leighton will start a formal training programme - Leighton University - to train its own employees as well as those of its sub-contractors, mainly carpenters, electricians, plumbers and the like. With this initiative it hopes to take care of the skills training, a formal system that is lacking in India, according to Mr Chivers. Leighton has about 300 employees in India - in Delhi, Mumbai and Chennai.