Buildings cast in steel
Previously slotted as a sub-entity of construction, the market for pre-engineered steel buildings has now matured into a separate sector says Malav Patel, MD, Phenix Varco Pruden in an interview with Rajesh Kulkarni.
Give us a brief background of your company and its core focus areas in the PEB segment?
The MB group is a fifty-year-old infrastructure company with a presence in all key economic sectors like power, irrigation, industrial construction, bridges and flyovers. We pioneered the delivery of large scale turnkey solutions in India.
We have recently entered into Pre-Engineered Steel Buildings (PEB) market in collaboration with Varco Pruden Buildings, U.S.A., having set up a state-of-the-art manufacturing facility near Ahmedabad. We already have a presence in support-less-roofing-structures with Proflex as our brand.
What is the scope of your collaboration with Varco Pruden Buildings Inc.? What is the role played by them in this venture?
In principal, the collaboration covers design, detailing, drafting and providing online/ electronic inputs to CNC machines, making the manufacturing operations automatic and /or semi-automatic.
These are the fundamental functions and are completely integrated through proprietary software called VP Command.
This integration helps us to give error-free solutions consistently, which is unique to us. Apart from this, knowledge transfer is a continuous and an ongoing process by way of periodic manpower training software upgrades.
Kindly elaborate on the recent Rs50-crore order bagged by Phenix VP from the Tata group for the Nano project at Sanand, Gujarat? What were the key reasons for Phenix VP bagging this project?
When you are equipped with the right capability and have proved yourself by way of performance, you are bound to attract big names in the industry automatically. We are manufacturing the most critical building for Tata Nano project, namely its paint shop.
We are going to supply approximately 4000 tons of steel components for this facility. The complexity is in the function of the building, which calls for multiple mezzanine floors, a heavy load bearing capacity of the main–frame structure and a height of approximately 25 meters.
Apart from that, we are also involved in dismantling & re–installing 35 odd ancillary buildings a covering a total area of 65,000 square meters. There is no doubt that this would be a quantum leap for us, as far as awareness and visibility are concerned.
How do you plan to leverage this association with the Tata group moving forward? Which are the other major clients serviced by Phenix VP in the past?
With the arrival of the Tata Nano project here, this area is likely to be transformed into an automobile hub with ancillaries mushrooming around. We are already being flooded with enquiries and are currently working on the schedules to meet these requirements.
In terms of our other major clients, we have served majors including: L&T, Asia Motor Works, 3M, Tetrapack, SemIndia, Essar and Simplex. In a short span, we have covered some of the major sectors and all major applications.
Kindly detail some of your other key ongoing projects? What is the total size of your existing project portfolio?
Almost all the projects we are executing are strategic. We have covered everything from building a small shelter for the Uttar Pradesh police and a hydro project at high altitude in Himachal Pradesh to a massive warehouse in Andhra Pradesh, a shopping mall in Maharashtra, a big factory in Karnataka and an automobile engineering unit in Gujarat. From our first order to our last, the value of the order booking is somewhere around Rs250 crore.
What is your assessment of the scope offered by the domestic market for PEB solutions?
Though there is a slump currently, we are expecting the market scenario to recover over the next 8-10 months. PEBs are largely accepted only for industrial usages. From a technical and conceptual perspective, there is no limit for PEB. Any building that is constructed using bricks and mortar can also be built using PEB. In the US even residential buildings are constructed using PEB.
The domestic market might take some more time to reach this level but we are already working towards breaking this jinx. As a new initiative towards this end we are working towards coming up with a Green-PEB for the first time in the country.
From a client perspective what are the USPs of opting for PEB solutions? How does it compare on quality, cost and efficiency parameters with conventional solutions?
Previously, PEB used to be a sub-entity of construction. Now, it has matured into a separate sector with distinct identity of its own. In a fast paced environment, time is money. The customer always wanted the building yesterday. Here I would like to mention that we have delivered an Express-PEB to some of our clients. In one case, we delivered 1 million square feet in less than a month.
While PEB scores high on quality, delivery, methodology and economy, Phenix furthered it with enhancements like bar-coded material, erectable-sequence-supply.
How would you define the key issues and challenges facing the domestic PEB segment today? What according to you needs to be done to rectify this situation?
The first and foremost challenge lies in changing the mindset for acceptance of a PEB vis-à-vis a conventional steel or concrete building. If the market is considered huge with only low rise industrial constructions, you can imagine the potential if high rise or residential projects also start using PEB. I personally feel that awareness has to happen in a big way.
Construction and infrastructure development have been among the worst hit by the current global recession and liquidity crisis. How has this impacted the market & demand for your products and the PEB industry in general?
This is part of a cycle. Whatever goes up has to come down and vice-versa. Strategy is the key here. The first priority should be having the right capacity for all weathers with ROI as a base.
A slowdown as such is different from a standstill. We are not in a standstill today. Again, the current situation is not patterned. We are catching the right clients at the precise moment with an accurate approach. For example, the defence sector is slow down-proof. We got registered with Military Engineering Services recently, making us pre-qualified for all government projects.
How is Phenix VP placed on the manufacturing front and what is your current production capacity? Do you plan to augment/reduce capacity in keeping with the existing market scenario?
We have a production capacity of 75,000 MT per annum, one of the largest in the country. In a nutshell, I would say Phenix VP is comfortably placed in these turbulent times. This is a scientific conclusion based on re-evaluation of certain critical parameters. I prefer not to comment on augmenting or reducing our capacity for policy based reasons.
As a technology-driven company to what extent has Phenix VP leveraged technology across key processes like: Design, Production Planning & Control, Manufacturing & Logistics?
We have revolutionised the system here. Most of our processes are automatic and all our functions are integrated. We are crystal clear in our objective right from the conceptual stage. While most of the current players are struggling for ‘customer satisfaction’ itself, we are moving towards ‘customer delight’.
How would you define the role played by latest technologies in assisting Phenix VP’s endeavours to manufacture innovative and cost effective products?
In the orientation classes itself, we remove ‘technology-stop’ from the minds of our human resources. We formed a separate department consisting of industry seniors, which ensures regular upgrades to latest innovative technologies related to us. For us, the definition of innovation is slightly broader. We all assemble on a weekly basis to discuss, debate and conclude on many such related aspects.
Lastly, going forward what according to you will be the key growth drivers for the PEB segment in India over the next two years?
I see two factors broadly. One is an increased awareness about the availability of cheap (RoI model), effective and innovative solutions in the form of PEB. Another is good customer service, which should be quantifiable.