Schwing Stetter plans to enter precast equipment business

The company currently has a revenue of about Rs 1,200 crore, eyes 15-18% growth

Schwing Stetter India, the subsidiary of German construction equipment major Schwing Stetter, has said that the company is looking at launching precast equipment through an acquisition or a manufacturing license or a joint venture to cater to the growing precast construction market.

The company currently has a revenue of around Rs 1,200 crore and expects a better growth over next couple of years, as the road construction industry has started growing again, said Anand Sundaresan, chairman, Schwing Stetter Sales & Services.

The company is expecting a year-on-year growth of 15-18 per cent growth in next three to five years. If more products come in, the growth could be better, Sundaresan added. Schwing Stetter currently has around 63 per cent market share in the segment.

"We are looking at some additional products within the concreting equipment segment. Precast is going to be the future and we are looking at doing something in the precast equipment segment. We are talking to some manufacturers in Germany and US and other places. It could either be an acquisition or a license manufacturing or a joint venture,"he said.

XCMG China, which has earlier acquired the German concrete equipment firm, has recenly announced plans to invest around $150 million (about Rs 1,000 crore), in India to set up a manufacturing facility for its non-concrete construction equipment business. This is higher than the close to Rs 400 crore invested by Schwing Stetter so far in the Chennai facility.

The existing facility of Schwing Stetter has adequate capacity to address the market. At present, the construction market is driven by the road projects awarded month on month by the government, while the real estate sector is not doing well and the port, metro and power projects are not in a high level of growth.

However, overall the market is expected to grow, as metro rail projects are expected to start and the consutruction equipment industry is generally happy on the developments, said Sundaresan, who is also the President of Indian Construction Equipment Manufacturer's Association.