E. Moses, advises buying construction equipment if it is usually required for the regular work executed by the organization or the balance sheet of the company is healthy enough.

What is your strategy to expand business for existing product range?
The first half of the current financial year has seen a substantial drop in demand for Construction equipment in general. Market sentiments have been rather weak compounded by limited liquidity and slow pace of Project execution especially in the Infra sector, which is usually the main growth driver.

We have maintained our focus on retaining our customers with best-in-class field support. Also, our current focus on Mining business, Mini Excavators and a wide range of Excavator Attachments is expected to yield good results.

Looking at the present scenario what would you advise for procurement of Excavators etc? Buy it or rent it, why do you say so?
“Buy or Rent” is always a question to be answered before a procurement decision is finalised. Common considerations for buying are a large work volume of five to seven years, having a capable fleet management team, profit-making organization – so the depreciation benefit can be availed, time-bound Projects, etc. Renting is advisable when the work in hand is limited and does not cover the pay-back period. Also, if it is not usually required for the regular work done by the organization or the balance sheet is not too healthy.

Kobelco excavators are a good investment for anyone with adequate work in hand. Its high productivity implies a shorter pay-back period. Also, with the wide range of special attachments, the machine utilisation is better and the same base machine can be used for different jobs.

What are the challenges you see are faced by the industry in dealing with upcoming demand and supply?
The market trend is not sustained over the medium term and this makes it a big challenge for OEMs to plan their investments for scaling their production to match with the rise and fall in demand in the short run. The recent dip in demand has shaken the confidence of most players though most are cautiously optimistic that the market will recover in the coming months.

What is your expectation from the industry bodies and policy makers to capitalise the present market?
The Govt. has been trying to correct some basic factors which are expected to usher in changes over the medium to long term. Some more measure are needed to improve the market sentiment through improved liquidity and resumption of the work at stalled/ ongoing Projects to have an impact on the immediate growth prospects.

What is your company’s outlook for 2022?
The Company has charted an ambitious growth plan with ramped up production to meet the anticipated demand for our equipment in the coming years. The recent dip has upset the trend and revised plans are being worked out.

E. Moses is Vice President – Sales & Marketing, Kobelco construction equipment

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