For Metso, India is turning into a manufacturing hub

Finland-headquartered Metso Corporation, a €3.2-billion industrial equipment maker, is planning to boost its investments in India, eyeing both greenfield expansion and inorganic growth opportunities,

Pekka Vauramo, Metso’s President and CEO, told BusinessLine. Metso offers equipment and services for mining, aggregates, recycling and process industries.

According to Vauramo, Metso has invested over €100 million over the last 25 years in India. Out of the total investment, €70 million has been invested in 2018 alone, including in increasing the capacity of its manufacturing facility in Alwar, Rajasthan by 35 per cent; developing a 20,000-tonne capacity foundry in Vadodara; and acquiringthe valve automation division of Mumbai-based Rotex Manufacturers and Engineers Pvt Ltd.

“India’s growth rate is very high and if things continue the way they are, the growth will continue to remain high. Hence, we will continue our acquisitions and investments here,” Vauramo said.

Further expansion

Vauramo added that the company is continuing expansion at the Alwar plant.

“We are building an additional factory there, although it is at an early stage. We still have an undeveloped plot there, so there is space to do more,” he said. Metso currently has 1300 people across the country, 700 out of which have joined the company in last two years.

Metso has a solid market share of around 25 per cent each in the mining and aggregates segments, around 5-10 per cent in the valves segment and close to 25 per cent in the pulp and paper industry..

Increasing the levels of localisation, expanding manufacturing capabilities as well as putting more focus on services business have allowed Metso to grow at a CAGR of over 30 per cent in the past few years.

Export potential

Metso’s sales in India in 2018 stood at €200.8 million (₹1,606 crore). Orders secured in India in 2018 totalled €293 million (₹2,385 crore), over 40 per cent increase from 2017 order intake of €166 million (₹1,333 crore).

“We are doing surprisingly well in India, but I think we can do much more than just ‘Make in India’ — we can internationalise,” Vauramo said. Exports account for about 20 per cent of Metso India's sales, having seen a rise of approximately 50 per cent in the last four years.