K2 Cranes aspires to be a world class material handling equipment supplier at competitive prices. It will produce its own brands of various sub-assemblies that will go into material handling systems. In five years' time, it plans to be global player, says AG Joseph, Vice President - Marketing, K2 Cranes. Excerpts from the interview.
Brief us on the core strengths and competencies of K2 Cranes.
K2 is part of the Rs 1,200-million Karthigeya Group. The group is in business for the last 25 years and has an enviable reputation. K2 has a world class manufacturing facility near Chennai. Within a short span of four years, K2 has installed more than 350 EOT cranes, throughout India. It has a national coverage in India with adequate service back up in all places. In recognition of our success, Street UK has appointed us as their exclusive distributors for India for their hoists.
How do you rate your success so far?
We have grown at a CAGR of more than one hundred percent over the last four years, which is very good. We succeeded because we supplied international quality cranes at competitive prices. We also back up our customers with excellent service, which resulted in more than 30 per cent repeat orders.
Which are the verticals focused on by K2 Cranes?
K2 focuses on all manufacturing verticals including automotive, power, plastic, and infrastructure. We have more than 350 installations as on today.
How do you view the demand-supply scenario?
Because of a slowdown in manufacturing activity and also the delay in new industries coming up, the crane market too, has slowed down. But we think the market will pick up very shortly. K2 targets to achieve ten per cent market share in the next five years.
Brief us on your sales and service network?
Currently we have a good presence, both in terms of sales and service. We have a presence in the west and east and a substantial presence in north India. We will be covering the entire west and north within the next six months.
Has the financial crisis impacted your bottom line?
The year 2012 has been average for us, due to slow down. Obviously the financial crisis will hit our bottom line. But, with our efficient management, we are confident of minimising the damage. We already see signs of recovery, since the last two months. We think from April 2013 onwards, we should be back to 40 per cent growth rate.
What is your take on the existing safety norms and regulations?
Our BIS Standards are world class. K2 completely meets BIS standards. However, we shall continue to focus on safety and deliver one hundred percent defect- free and safe cranes.
What are the product and technology trends in this segment?
We think there will lot more of automation, maybe robotic control too, will start happening in this segment, especially from a safety/trouble free operation perspective. Also, there will be a lot of effort to reduce the weight of cranes.
Tell us about the value proposition offered by K2 Cranes.
We would like to offer world class cranes at competitive prices. For the same capacity, our cranes will be at least 30 per cent cheaper than international brands, without any loss in efficiency. We shall also provide unmatched personalised service support leading to minimum downtime and long life, and the highest return on investment (ROI). In short, K2 Crane means value for money (VFM).
What has been the investment so far?
We have invested more than Rs 250 million in this business. We propose to invest another Rs 250 million over the next three years.
How do you view bC India as a business platform?
We think it is a good forum to showcase relevant products. This year, we don't have any plan to launch any new product in bC India, though.
How do you look at the growth potential three years on?
We see very big growth potential over the next three years. We are planning to touch a turnover of Rs 1,000 million in three years' time. Of course, the challenges are plenty. But we believe that K2 is competent enough to meet the challenges. We are expanding our marketing and service footprints throughout India, within the next one year. We have also strengthened our R&D to indigenise many of the imported sub-assemblies, which will bring down the prices substantially.