Manoj Kumar Pillai, Director of Forest-press Machineries Private Limited talks to EPC&I on the prevailing conditions of CE market in India, its growth drivers, trends, the key challenges and the role of government policies while reiterating that the market is opening up in India for quality players and the inception of entry level machines in a cost-effective solution will enable them to grow faster than any other competitors.

As an established leading player in the Construction Equipment market in the country, what is your opinion on Infrastructure development activity in the country?
India is the biggest market and one of the fastest growing economies in the world. Major developments have commenced in infrastructural, industrial, residential and commercial areas. Construction is the backbone of any economy and concrete plays a major role. Steel is the most expensive building material followed by cement which is the second most and integral part of concrete.
In a country like India with different climatic conditions, language barriers, infrastructural hazards and lack of awareness as well as corruption and bureaucratic issues slow down or derail the development. We could see some changes in recent past as the government is trying to find solutions to most of the above mentioned points and still the focus needed for a proper education system connected to practicality and implementation of the same within a stipulated time frame. In my opinion time is money and the easiness on banking activities is necessary for the smooth flow of the Indian economy.

While some research analysts and economists claim that it is skewed more towards road building activity, development of power plants, ports, airports, etc continue to lag behind. Do you subscribe to this view?
Definitely, infrastructure is an integral part of any development which needs major attention in a country like India. Here, the government has already addressed this within a short period of time and I am not expecting any magic immediately. This will take some time as the entire system needs a major change.
The change is necessary from technology, process, identification of right projects, partners, method of implementation and economic side of it. The government is already announced the idea of Smart Cities and partnering them with other international cities and associate with developed countries in this regard.
This will take some time as the construction standards and materials are different and this will be difficult to do something like this without standardising the products. I hope the government will address this point also.
Electricity, ports and airports are necessary for the quick transfer of man and machines to the desired location easily, and in the housing segment over pricing and over supply is there and the present steps of government will curb some malpractices and correction in real estate sector.

What would you say are the main growth drivers in a highly competitive market?
Right quality, price, availability and after sales supports are important for any product in any market. We have already seen the situation in China and the mind set towards Chinese goods. The government is already taking a good step to support Manufacturing in India.
It is the duty and responsibility of each citizen of this country and the companies who prefer to do business in India. The quality will sustain for a long time and that is the main point to succeed in a most competitive market. We could see high domination of Indians in Middle East, South East, Africa, Europe and in America and, I am sure, they will support any Indian company in this regard and the manufacturers in India should do their level best to achieve the goal.

How have the policies and initiatives taken by the government to develop the country’s infrastructure reflected on your company’s growth?
The government policies and initiatives are good and well thought of, but it will take some more time to be implemented properly to start giving returns. GST is a good example as it took a long time to pass it and further one more year it will take for the implementation. This will give benefits to everyone in the country from an individual to a company or any other organisation. Most of the initiatives are majorly addressed for the improvement of infrastructure projects. Especially places like North-East were never addressed by the previous governments and a major shift is visible in the recent past. In a premature market we are not expecting any major change immediately and a steady and sustainable growth makes better sense.
We are able to understand the market situation and designed some products suits to such market for the entry level customers to start with a limited investment, land, labour and other items. This will allow us to make an early entry to such markets and support the initiatives taken by the government.

What are the company’s expansion strategy and potential segments in Indian construction equipment business?
Forest Press identified India as the fastest growing economy, and one of the most important markets by size, strategic location, service oriented and quality consciousness and other reasons. To focus and capture the market share, the Forest Press management decided to invest and expand the Indian operation.
In this regard, we have already acquired land in Bangalore and started the construction of our new factory. An investment of GBP 3.0-million is in progress which will be ready by middle of next year. The expansion will allow us to increase the production capacity three times and targeted to export 50 percent out of the Indian facility.
We would like to utilise the Make in India initiative by the government of India. India is a service-oriented economy which is in an expansion and absorption mode to technology and we would like to utilise the opportunity related to it.
Higher import tax, freight cost and lack of infrastructures are the major issues in India. Transportation of the high dense concrete elements is the biggest challenge. To overcome this situation, we are launching couple of entry level and economic models of the machines for different applications.
Basically this could be helpful for a new comer into the industry to start with a limited investment in the form of land, labour and machines. Construction companies will be able to set up such machines in project location which allows them to save excise duty and transportation cost as well as time. The latest and innovative technology in an affordable cost is our strategy to Indian market.

In the face of aggressive competition putting strong price pressure, coupled with the liquidity in the market which will impact cash flow and profitability, what are the transformations that leading companies such as yours need to bring about to ensure that you not just grow at a predetermined rate but grow substantially?
I would say the balancing act is necessary for a stable and sustainable growth. Here, in this case, sometimes you have to deviate from the normal methods and proper focus and right team is necessary to address this situation.
So, in my opinion, a combination of multiple factors need to consider from quality, cost, launching time, marketing strategy and targeted customer bases are some among them. Each business house and models are different and a generalisation will be applicable only up to a certain extent.
This may be different in another industry and even within the construction industry we could see the difference. To identify the difference and proceed with the right path needs a good experience. I think, we have already our homework very well and the experience of Forest Press management including Pete Bullock and myself is active in this industry for a very long time and serious to what we are doing.
We do not have any other hidden agendas or interests in other industries. Some of the managements are only involved in the industries just as financial investors will not have any interest above it. Until and unless you are not involved completely and aware of the facts then expect surprises anytime. 

Many manufacturers in the country are making innovative strides to modify their existing lines to enable them to deliver higher production outputs, improving the productivity and, simultaneously, offering a good RoI. What are your plans on this front?
This will be a completely wrong thought process and will force to compromise in various instances. Normally a scientist or a technical team designing a machine or any other product will have certain basic ideas in place and based on that they are doing it. Some of the modification or expansions will work for a short term period without giving any troubles, but in the long term this will create major issues.
It makes sense to look into it in different angles and talk to the best experts in that industry for long term. We offer various solutions based out of the customer requirement and support them from market analysis to product range, employees, sub-suppliers and foundation civil works.
We know the importance and complications related to it and consider our customers as partners. It is necessary for the customers to listen to the principles once they make a decision and follow the recommendations to ensure the smooth running of such equipment.

Based on requirements of Indian OEMs’ array of individual products and standards, how are the equipments featured and designed to have complete equipment integration?
The situations have changed in the last decade as latest innovations and technologies are available easily, and the purchasing power of the customers has also increased substantially. The presence of major players in the important market of India and the cooperation allows integrating multiple machines or activities with an integrated or single control system. Thanks to the major suppliers such as Siemens, Bosch Rexroth, Parker, Schneider, Sew, Lenze and Ifm.

How do you ensure installation flexibility?
The fastest installation is very important and we develop certain systems in this regard. Standardisation of parts, experienced employees, plug and play design of individual assemblies, support on foundation design and civil works are some among them. We do the assembly and testing of the complete items in house to ensure the smooth installation within the stipulated time frame. Right tooling and follow up of the project schedule is equally important.

How is the technology placed to suit Indian requirements taking into consideration that the equipment works for extended duty cycles and adverse conditions within the country?
It doesn’t matter within the country or out of the country as the most important is the right attitude and follow the advice from machinery suppliers and experts in this industry. I would like to say this with a simple example as we all know that the imported automobile was not very popular 20 years back, and always we heard excuses like the imported vehicles will not survive in Indian road conditions.
But, today, we can see all brands of vehicles from around the globe is moving in India without any troubles. But, one point is very important as the people are ready to maintain and approach the automobile agency for regular maintenance and using original parts.
In concrete industry majority of them are trying to use counterfeit parts or local items. Second point is the change of employees as we could see that the employers are not providing proper facilities or on time payment and the employees are also not ready to work sincerely.
This mentality needs to change and if they follow the instructions properly and keep the employees for longer time will automatically reduce half of the issues which results in extended duty cycles.

OEM support and cooperation for future product upgradation is important. How are aspects like prototype performance assessment in varied working conditions being addressed based on the emerging requirements of the Indian customers?
Forest Press has very special arrangements with all the OEM suppliers which allows us to share the knowledge and support as and when required. We do the assembly and testing of each individual assembly in house to avoid any last minute surprises during installations at site.
We maintain a proper record of each activities and challenges during installation and commissioning, this allows us to do the necessary steps and modifications accordingly. Once the project is finalised from design of civil foundation to complete installation including commissioning and training will be scheduled in a professional manner. A systematic and professional approach like this will be always an added advantage for a customer to deal with Forest Press.

How are you addressing issues regarding affordability, business expansion and retention?
Affordability is always a point connected to quality which we prefer to go with, and secondly the right business plan. Concrete and construction industry in India is considered as a non-organised sector and few exceptions are there like Shobha Group. They already have done a backward integration to look into the quality and affordability according to different locations.
The situation in Europe, Australia or America falls under organised sector and good examples are Marshalls, Boral, Semmelrock, etc. Business expansion is in the progress as we are targeted to double our production in 2017, and increase further in 2018. The market is opening in India for quality players and the inception of entry level machines in a cost effective solution and local service and support will allow us to grow faster than any other competitors.

What would you say are the primary challenges going ahead?
In a start-up and big market like India, the challenges are inevitable, and we are well equipped to face such situations. The group Forest Press is active in this industry for 35 years, and personally me above 20 years in different parts of the globe within the same industry.
I think the experience will be always worth to overcome such challenges. Infrastructure and lack of awareness are the major challenges and a revamp in educational system connected to skill development will be an answer to it.
Government is already giving enough attention to development including infrastructure. Availability of labour work force and funding arrangement will be a major task which can be addressed by proper planning and introduction of systems like robotic handling and software.

What is your forecast of CE demand in the days ahead?
Demand will improve in coming months especially after the implementation of GST. Basically, in my opinion, by third quarter of 2017, will be a much better position for the Indian economy. Big boost is expected in India by 2018 unless any major change occurs in the global arena. Europe and Middle East is completely down, and Africa will take a further one more decade, and major expectations are only in India and adjoining Far East nations.
Within India the demand will increase overall especially in “C” grade cities and wherever the Smart Cities are coming. North East will have better option and chances of development in coming years.

Lastly, any new products and services expected to be launched at bc India 2016?
Forest Press is launching the economic model called Block Master BM 4 SA and Mini Press System. Both of them are considered as entry level machines for a new entrepreneur to start with limited investment in land, labour and other things. This will be a good option to use in projects to save the excise duty and transportation costs.
A combination of such machines could be able to produce Ready Mix, Blocks, Pavers, Slabs, Kerbs and other products necessary for any construction at site. One could consider Forest Press Series, Block Master Series and Mega Mixers as a total solution and easy to procure, install and run according to the requirement as a commercial entity or as a project based one in a customised manner.

Different forms of concrete and its applications

Concrete Industry	Products	Applications/Usage
Ready Mix Concrete (RMC)	Ready Mix	Buildings, dams, bridges, roads, etc.
Semi-Dry Concrete	Blocks, Pavers	Buildings, roads, ports, etc.
Autoclaved Aerated Concrete	Blocks, Panels	High rise buildings
Wet Press Concrete	Kerbs, Slabs	Roads, river and canal linings, paving
Precast Concrete	Walls, Columns	Buildings and bridges
Self-Compacted Concrete (SCC)	Special Concrete	Dams, ports and bridges
Wet Cast Concrete	Designer slabs	Aesthetic finished products

“Infrastructure and lack of awareness are the major challenges and a revamp in educational system connected to skill development will be an answer to it.”