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Interaction | September 2015

Under-utilised capacities require to be substantiated with demand

Nikhil Gupta | Executive Director - Cables, KEC International Limited

What are the advanced products available in India?
LT and HT cables form a major part of our business, which is highly price sensitive and focus is on being competitive. Here, producing good quality cables that meet standards is a challenge and the focus will need to be lean manufacturing and tighter process control. In EHV cables, last year we manufactured 220 kV, 2,000 mm2 cable which is largest ever made in India. As power requirements of urban areas increase, there will be demand for large size cables to deliver bulk power reliably.

Where is the demand coming from and for which products?
The demand driver is infrastructure growth and almost every segment in infrastructure has attracted government policy decisions for investments. This translates into major demand coming from greenfield and brownfield projects, and across all segments in power and telecom.

How equipped you are considering future orders?
Capacity utilisation in the cable industry is around 50-60 per cent. So deliveries are not a major issue. But, delays in customer´s projects are inevitably passed on to us and we have to manage that risk.

What is your plan for future expansion?
We can make around 3,000 km of LT cables and 250 km of HT/EHV cables per month. As the industry capacity is under-utilised, demand has to increase significantly to justify any new investments, if you plan to grow organically.

Meanwhile, in terms of market share, as a thumb rule, cables is 2-3 per cent of the generation and transmission sectors, and 12-15 per cent of the distribution sector. Our market share will be around 5-6 per cent of the cables market.

What are the current trends in terms of offerings and utlilisation?
We are looking to innovate and introduce new products that are customized to suit local requirements. We are also looking at some specialty cables segment like Solar PV and fire survival.

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