Certainty of growth still not in sight despite boom
Certainty of growth still not in sight despite boom

Certainty of growth still not in sight despite boom

Makarand Marathe, Director, Cement Division, Thyssenkrupp Industries India (tkII)

Makarand Marathe, Director, Cement Division, Thyssenkrupp Industries India (tkII) believes that even as India's demand for cement shows signs of gradual recovery, equipment makers need to prepare themselves to engage with an increasingly discerning customer.

What are some of your most recent areas of focus?
Primarily, what we can offer to the industry, the entire gamut of pyro processing and grinding technology. Now, in terms of pyro processing, apart from new generation Preheater, and Cooler, we can talk about the and Waste Heat Recovery system. As far as grinding is concerned, we have a well proven high pressure grinding roll for raw material grinding in "finish mode". We can also offer competitive, energy efficient, "semi-finish" operating circuits. These are some of the areas that we are focusing on right now. As far as the most recent trends in cement are concerned, if you take grinding, people are no longer looking at Blaine or 7 to 20 days' strength. They are looking at early strength generation and residues on 45 microns. This is something that can be achieved through innovative circuits and new separators that we have launched. Finally, it is about creating value for the customer who is examining different options to penetrate the market and we have to support him.
Any innovative products in the pipeline for 2018?
We have come out with a roller driven vertical mill, which has already been installed in a number of plants worldwide. It's the new generation QUADROPOL series roller mill. This is a new product and when you talk of high Blaine cements, especially when you talk of 3,800 plus kind of Blaine, this is the product that we wish to offer. But I must admit it is not immediately on the cards. However, it will be one of the options to offer to the Indian customer by end 2018. Presently, we are working on the cost economics and we are hopeful that we can offer a product which will be affordable as the Indian clientele is very discerning and likes to evaluate the return on investment.
How much of your R&D is in India?
Most of our R&D activities are centralised in Germany since we already have a huge set-up there. In India, we have a small facility catering to our other verticals.
As we speak, do you perceive any paradigm shifts taking place in the cement business?
The cement business in India needs some stabilisation because already huge capacity addition had taken place during the 1990s and 2000s. So, all that capacity needs to be used up. Today the industry is running at about 65-70 per cent of its utilisation. And even if you take about 6 to 7 per cent growth in GDP and 8 to 10 per cent in the cement demand, it will still take about three years to catch up with the installed capacity.

Even if you take the utilisation up to 90 to 95 per cent, we still have two to three years to go. It's only thereafter that the push for new investments will come in. Of course, this is the economist's view. But if you look at the economic reality, large cement manufacturers who have the financial muscle to make investments and acquisitions, will scout for new projects because they will get the best bargains from suppliers. They will be ready for the boom time in two to three years because a cement project takes about 24 months to be completed. So, I don't see any big shift in terms of business generation, but definitely the growth will be solid. Since the government is the biggest spender as far as cement is concerned, it has announced plans for road construction, housing, etc. Therefore, this 8 to 10 per cent demand for cement is expected to sustain. The market will not move into the boom mode yet but there will surely be growth.

And how is technology redefining the contours of the business?
Digitalisation has come into the cement business. Discussions with some of our customers have revealed the change in attitudes in the business. Fifteen years ago, with everything being done manually, nobody spoke about laboratory automation. Now everything has changed and people are looking at robotised lab as a significantly important option to have in a plant. Take Wonder Cement for instance. The company demands a premium in the market because it has lab automation in place, which helps it monitor parameters, mineralogical phases, physical properties and cement quality. This view and vision has definitely come in and is going to stay. Even if it is adding some additional cost per bag, manufacturers are demanding that additional premium and getting it.
So, where do you see things headed in the near and the medium term?
We will surely pursue projects but we also have to come up with something innovative. We have to address the environmental issues in terms of SOx and NOx emissions. There have to be new alternate fuels to be tried and we have to come out with solutions where more and more alternate fuels can be used as our substitution rate has to go up. At 5-10 per cent, India has one of the poorest substitution rates in the world. That has to increase up to 15-20 per cent and machinery manufacturers have to come out with solutions. This is something that we have to address. So, I would say that the business will definitely grow and there will be more innovative options available. Clients too would be asking questions in terms of energy efficiency and product quality.


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