Negatives:-
- A slowdown in Construction Equipment( CE ) sector which saw a sales drop of 60% in the last two quarters of 2008-09 has caught us completely unaware. CE Industry is the largest market segment at 45%, served by the company.
- The Company's over reliance on the growth of the CE sector has hurt the company severely. CE industry is likely to have no growth in 2009-10. With this our business from this sector will go down from 43% sales in 2008-09 to 36% sales in 2009-10. This industry should start growing in 2010-11.
- The sales to Automotive Industry which was 14% of sales in 2008-09 will go down to 12% of sales in 2009-10.
- The momentum of growth that the company has acquired over the past two years has been severely impacted. The slowdown has set us back by two years in our plans.
- Biggest area of concern still remains the availability of technically skilled personnel.
Positives:-
- Company is now focusing on Railway Transportation(RT) sector and Power Generation and Distribution Industry along with CE sector.
- RT sector is undergoing a transformational change with the introduction of Stainless Steel cars and wagons. In 2008-09 this was 3% of our business and this is expected to grow to 15% in 2009-2010.
- Company has secured a large order from Bombardier Transportation for supply of SS assemblies for their order from Delhi Metro.
- Huge progress has been made in acquiring the expertise to take up work for RT sector. Keeping this in mind one of the facilities has been converted to carry out the work only for the railway sector. Similarly one of our facilities has been dedicated to work only for the Power sector.
- The other major change in the strategy will be to go up the value chain in supplies. Rather than focusing on increasing volumes we will work towards improving value addition in the jobs. In this way the profitability of the company will grow faster than the sales.
- Company is trying to grow in Power Generation equipement sector to take up the heavy fabrication work needed by this sector. Begining was made in 2008-09 by supplying large fabrications upto 20 Tons in weight to Hydro Power sector.
- Pune and Savli units can take up the work upto 30 Tons , small orders have been executed from these plants and efforts are being made to get more business from this sector.
- The expansion at Bangalore was completed during the year. The capacity remained unutilized due to lack orders from the customers.
