HS Bhattacharjya, Chief Executive Officer, Quippo
The $1 trillion investments outlined by the government in the 12th Five Year Plan, as well as credit limitations are expected to fuel the new equipment rental business.
The equipment rental business in India is yet to evolve from its nascent stage. The organised rental business entered the Indian space with Quippo`s pioneering venture in 2002.
Though the mode and pace of business across the world has gone through a severe sluggish phase, a ray of light is gradually appearing. The years gone by have seen regulatory roadblocks, liquidity crunch and lack of investments, leading to a sharp decline in the demand for construction and mining equipment.
However, the $1 trillion investments outlined by the government in the 12th Five Year Plan, as well as credit limitations, are expected to fuel the new equipment rental business.
The equipment rental industry is likely to draw an advantage from factors like the following:
The rental industry has its own inherent challenges, the biggest of which is the unfriendly tax structure. For a pan-Indian company like Quippo, inconsistent logistics charges prevent free movement of equipment from one state to another. Added to this are the local tax structure and entry taxes.
The rental industry needs to make a united appeal to the government for support in this arena or else the tax structure will impact the rental proposition adversely. Steps like the introduction of GST will facilitate the rental sector to a large extent. Further, the mindset of the Indian infrastructure industry is not rental-friendly and hence, credit risk is an impending factor in this business.
Innovative steps by Quippo
Quippo's USP is their pan-Indian presence. We have seven major hubs at strategic locations attached with almost 40 stockyards covering almost all the states of India. With a robust fleet mix from a backhoe loader to a hydraulic piling rig, their capability to cater comprehensive equipment solutions helps them stand out in the crowd. Also, their forward thinking and innovative approach have steered them well in tough times.