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Interaction | February 2011

With stringent green regulations, developing products to meet the new requirements will be a challenge

Sanjay Bondre, MD, Kohler Power Systems—South Asia

What is the size of the global power solutions market and that of the Indian market?
From a global industry standpoint, the power solutions market represents a $10 billion opportunity. Of that, the Indian market segment represents approximately 11-12 per cent.

Are you into rental and selling of generators? Which segment is more profitable?
In India, Kohler Power Systems manufactures generators and makes them available for purchase. In US, it addresses the backup power generation marketplace with both a sales and rental approach. Globally, the company manufactures generators in India, France, as well as the US.
 
What is the order book position for 2010-11? Will you infuse more capital in your plants?
Highlighting our business model and focus on India, the company's India-based manufacturing operation posted double-digit growth performance and we expect a similar rate over the next five years. In terms of manufacturing capacities, the company evaluates its manufacturing capabilities against the needs of the market. Our Aurangabad plant assembly lines are designed to produce gensets of 1,000 kVA and below. In the event of additional investment into the plant, it will be expanded beyond 1,000 kVA in the coming years.

To which markets will your Aurangabad plant cater to? What is the per annum production? What was the investment made for the plant?
Products manufactured at Aurangabad help meet commercial, residential and industrial market demand in India, Sri Lanka and Nepal. It was our acquisition of Lombardini in 2007, as well as Lombardini's existing manufacturing plant in Aurangabad that helped facilitate our expansion into India. Since acquiring the plant, the company has added the genset assembly line.

What is the range (kVA) of your machines? Are you considering capacity addition? What are the demand drivers (sector and region-wise)?
The company offers 15-500 kVA DG sets from our Aurangabad plant and plans to extend up to 750 kVA by the year-end. Taking into account global operations, our company ranks as the world's third-largest generator (gas, petrol and diesel-powered) manufacturer with gensets available up to 3,000 kVA. Gensets from 1,000 kVA and above are imported from Singapore, China, France or US-based facilities. Our company is spread across the country, but the southern region is a leading driver of volumes.

Who are your competitors? What trends will you bring in to stay ahead of competition?
Established players, apart from our company, are Cummins, CAT and Kirloskar oil engines. New entrants like M&M and Eicher in small nodes, as well as imported engines in bigger nodes are also active in the market. Given the overall opportunity, the market is big enough for multiple power system providers. To stay ahead of competition, our company will deliver reliable gensets backed by advanced engine and controller technology, as well as the manufacturing best practices that we have been perfecting for 90 years.

What are the major challenges?
A key challenge for the sector and manufacturing of gensets is that it is dependent upon depleting natural resources such as diesel and gaseous fuels. As an industry, we need to explore technologies and products that are designed to work with sustainable energy options like bio-gas, solar, wind, etc. As a pioneer in energy conservation, the company has begun work in this direction. With increasingly stringent environmental regulations across the globe, developing products to meet the new requirements globally, and on a continuous basis, will be an ever-present challenge.

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