Sanghvi Movers

Concal highlights:

We are also strengthening our position by adding
12 new cranes and 68 ancillary equipments in our portfolio by incurring a capex of 163 crores
for FY23.

So just to answer the question in FY23, the wind industry added about 2.3 gigawatts of capacity addition.
Looking forward, we have order visibility and market pull for FY24 that the country may add 5 gigawatts of capacity addition in wind.

There is still about 25 to 40 gigawatts of additional potential which is
totally untapped in the country at 140 meters. And at 160 meters, it is more than 100 gigawatts.

, looking forward in
the refinery and petrochemical space, nearly 80 million tons per annum of capacity is being
added either as an enhancement Brownfield or Greenfield project. In thermal power sector,
almost 25 gigawatts of capacity are at various stages of construction.
In steel sector, 13 million tons per annum of capacity addition is expected in this financial year.
The cement industry plans to add about 80 million tons per annum by FY ‘24. Nearly every tier 1, tier 2, metro city has an elevated or underground metro under construction. There are more than 20 airports that are being constructed across the country, including but not limited to Noida, Guwahati and multiple such locations Wind is expected to add about five gigawatts of capacity addition in FY ‘24. So all around, all core sectors are firing on all cylinders and there is sufficient demand or increased demand for crane. Therefore, management has, of the company has started prudent to invest about INR 263 crores, which has been approved by the Board of Directors. And we will be investing in capacity addition to cater to this demand.
Board has approved the capex plan of INR 263 crores, because the pipeline is also a healthy pipeline we have, to cater to the needs of the customers.

Gross Block of Crane : Rs 2300 Cr

When we did a huge capex in the financial year ‘15 and ‘16 and ‘16 and ‘17, we did a huge capex of almost INR 800 crores, in those two years. After that, there was a downturn in the economy, more particularly with respect to the wind sector, where the government has changed the method of bidding for the wind sector from bidding tariff to reverse auction. And that’s why, you must have seen the wind installation in India has come down from 5.3 gigawatt to 1.7
gigawatt to 1.5 gigawatt on an average in last three years to four years. . In FY ‘23, India has already completed 2.3 gigawatt of wind installation. Now, Government has set an ambitious target of 8
gigawatt wind installation going forward. So there’s a good amount of business, we see from the wind sector.

Okay, that was the first thing.
Secondly, we have taken a huge amount of debt in financial year ‘15-‘16 and ‘16-‘17. We had a
debt in excess of INR550 crores. You must have noticed that, we have substantially reduced the
debt and the debt level as on today is INR160 crores.

You must have noticed in the financial year, we did a capex of INR111 crores. Last year, we did
a capex of INR161 crores. In spite of that, our debt has come to INR160 crores only. So now,
we have strengthened our balance sheet. You must have seen company has earned the cash
accruals in excess of INR233 crores. So we are better off as compared to the previous cycle.
That was the first thing Secondly, not only from the wind sector, the capex is happening across all the sector, where the
cranes are deployed. And that is being reflected in the yield as well as the utilization. And obviously, in the turnover of the company. So just to give some of the answers, we are better
placed as compared to what we were in financial year ’15-‘16 and ’16-‘17

So we don’t believe that, the current sentiment is a short-term sentiment. At least, I don’t believe
it. I cannot speak for my Board or the entire organization. And there is sufficient traction or
project planning from multiple private players that, have long-term plans after 2030.

So crane is a very central aspect of any infrastructure project. And we have the benefit of working
across several sectors. We are not limited to any one sector. Moreover, we have a brand name
and a brand recognition along with a 33 year track record, which a lot of corporate houses and
government agencies appreciate.

So I don’t comment on competition’s capex, but to put things in context, we are the only organized and listed player in this space. So you may draw your inference from there.

So it’s a good question. And I would like to share the following information with everyone
present. So there has been a transition in the wind industry in the last two years, where the OEM
has now been focused on delivering the product to their customer and not undertaking the
execution of the project. On the other hand, the customer of the OEM is an IPP, who doesn’t
have the project experience, to do a complete project execution in the wind industry. So we see
that, there is a scope for a player such as ourselves, where we can get involved in the providing
turnkey EPC services for the wind industry.
Cranes is a majority of the portion of the construction of a wind farm. We have started
developing in-house expertise to provide services other than cranes around various activities
involved with the construction of a wind farm, surface logistics, inter-carting, foundations. So
there are three categories of mechanical, electrical and civil BOP, which is balance of plant
which are the services around which, we are offering to our customers.

And lastly on the capex, that we are doing. So, when do we expect this capacity to be available?

Oh INR200 crores of this capex has already been executed. So this capacity is already available?
Sham Kajale: Yes, in the first quarter itself. Most of the cranes have come in the fag end of the April end.
Some trains have come in the month of May also.
They take about a month to start generating revenue from docks to site.
Most of, the majority portion of the capex has been backed by orders, yes.