Schwing Stetter India is preparing to invest about ₹400 crore in a capacity expansion programme, which will also include setting up a greenfield unit, as the leading concreting and construction equipment manufacturer is bullish on future growth prospects due to massive infrastructure development projects in the pipeline.

The company, a 100 per cent subsidiary of Schwing GmbH, a German concreting machinery manufacturer that is part of China’s XCMG group, came out strongly after the impact of Covid and recorded an average growth of 55 per cent in the past couple of years.

“This year, we expect to grow by about 30 per cent and this a conservative estimate,” V G Sakthikumar, Managing Director of Schwing Stetter India (SSI) told businessline .

SSI, which will be completing 25 years in India this year, will be investing about ₹100 crore in its Cheyyar factory, the company’s fifth factory located about 90 km west of Chennai, and about ₹300 crore in a new greenfield factory to increase the capacity of some of the existing products as also to start manufacturing of new products such as XCMG loaders, motor graders (earlier imported and sold here), which are targetted at road and mining application areas. For export markets, it will also start making concrete pumps. “The company will be requiring 40 acres of land for the proposed new factory,” he said.

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SSI’s revenue dropped from ₹2,050 crore in 2018 to ₹1,700 crore plus in 2019 and ₹1,500 crore plus in 2020 as a result of a halt in construction activities due to the pandemic. But it bounced back strongly in 2021 and revenue grew better than pre-Covid level to ₹2,552 crore.

Surge in orders

With the surge in orders on the back of a revival in infra projects, the company’s volumes zoomed in 2022 and it ended the calendar year with a revenue of about ₹3,945 crore. Its volumes were in the region of about 14,000 units in 2022 when the industry volumes is reported to have touched one lakh units.

While it has seen growth across categories, the company has established a strong presence in new product segments such as excavators. Its excavator (sold under the XCMG brand) annual sales grew to 1,500 units in 2022 from 300 units in three years.

“We hope to achieve volumes of more than 2000 excavators in 2023. Three years ago, we were in 14th position. We have now moved to seventh position and hope to be among the top five by next year,” said Sakthikumar, who attributed the success in this category to product performance and a wide range of offerings. SSI is also reported to have secured about 50 per cent share in products such as crawler cranes and horizontal drilling machines.

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Positive start

The current calendar year has also started on a positive note for the company as it has clocked revenue of about ₹2,200 crore (January-May 2023).

For a self-loading mixer, its earlier peak sales were at 600 units. But, in this calendar year, it has already touched 450 units as of now. Exports also picked up well for the company with the entry into newer markets. It clocked exports of ₹150 crore in 2022. But this year, export orders have already touched ₹150 crore. “At this growth rate, we are confident of achieving more than ₹5,000 crore revenue for 2023,” he said.

Sakthikumar asserted that the Central Government’s proposed massive outlay of $2 trillion investments in infrastructure development would have a positive impact on nine segments. “Going forward, there will be demand for our type of machines from every sector,” he added.

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