|“All in all GST is a welcome move”|
Managing Director, KSB Pumps Limited
|Over the last six decades, KSB Pumps Limited has grown with the philosophy to play a vital role in India’s development by equipping the diverse requirements of the pump markets. Rajeev Jain, has recently assumed his new role as the Managing Director, KSB Pumps Limited after his tenure in Indonesia. He shares his view on his new role, GST, end users market in India & company’s future plans to drive the growth of organization, in an exclusive interview with CEW.|
What was you experience during the
tenure with KSB in South East Asia
prior to assuming this new role?
How do you compare the business
environment in S.E Asia as compared
to India in terms of available and future
market opportunities and challenges?
South East Asia is a growing Region with a lot of opportunities. The emerging economies of Indonesia, Thailand, Malaysia, Vietnam offered a lot of growth opportunities for KSB; and we were able to increase our business substantially in the last decade. I had a great opportunity to be in the region to experience the diverse culture of each country in the region and which has helped me a lot to shape up my thinking and also my respect for the different cultures.
India, in that respect is different, as it is a more mature market! When I say this; I refer to the variety of Industries; the variety of markets and variety of local and multi-national manufacturers, and the vast geography too! So obviously, customers are rapidly becoming more sophisticated and differentiated, and hence manufacturers must be agile enough to keep pace!
Recently, the long awaited One Nation One Tax has received heads up from both upper and lower houses of Parliament and is likely to be implemented. In your view, how will this impact the market dynamics for the pumps and valves manufacturers in the country in terms of both opportunities as well as the challenges?
For us, from the business point of view, this is a very positive change and we hope it will bring a lot of efficiency improvement in our administration. We expect the business to be easier and simpler. The challenges will be on how fast we can adapt to this system and implement it smoothly.
Implementation of GST will attract lot of interest of foreign companies to the Indian market and also provide a major boost to the Make in India campaign launched by the Government. What kind of business trends do you foresee in the near future in your business domain?
With the “Make in India” Campaign, we definitely see that there would be increase in investment in this sector. KSB has already committed with an investment of almost 230 Crores; wherein, we are building a totally new facility for 100% indigenous manufacture of pumps for Nuclear and Super Critical Power plant applications.
As markets become more diverse and customer segments more narrowly defined, engineered product companies are developing increasingly complex offerings that provide integrated product-andservice solutions. Sales and Marketing teams, therefore, must be able to understand these offerings and how they drive value for the customers’ businesses.
It’s a transition from “Art to Science”; and five commercial topics are bound to offer companies significant opportunities to differentiate themselves in the new environment: Sales Force Effectiveness; Channel Management; Pricing and Profitability; After Sales and Human resources and IT enablers. Superior performance in the above areas will distinguish the winners in this highly competitive market!
Though there are significant number of small and medium scale pumps and valves manufacturers, the industry is dominated by major players. In your view, could GST be a game changer for the SMEs and how would this possibly change the market dynamics?
All in all GST is a welcome move!!
GST will be a game changing reform for Indian economy by developing a common Indian market and reducing the cascading effect of tax on the cost of goods and services. It will impact the Tax Structure, Tax Incidence, Tax Computation, Tax Payment, Compliance, Credit Utilization and Reporting leading to a complete overhaul of the current indirect tax system.
There are various benefits such as Cost Benefit being one! In addition, it would have a better compliance and revenue buoyancy replacing the cascading effect [tax on tax] created by existing indirect taxes. Tax incidence for consumers may fall lower transaction cost for final consumers. And last but not the least, apart from making the taxation very simple and transparent in character, it would improve our cost competiveness of goods and services in the International markets.
How are the end user markets evolving globally & in India for consumption across – hydrocarbon & chemical processing, water & wastewater treatment, infrastructure, power generation and other key industry verticals?
At present we see Water and Wastewater markets to be attractive and offers opportunities across the world.
The Oil and Gas and Mining markets are a bit subdued. Power Generation and Industry are sluggish, except for the nuclear supercritical business which offers some opportunities.
Of all these, which are the fastest growing segments that would drive the demand of pumps and valves in India and how is KSB planning to continue to maintain its position in the Indian market?
Water and Waste Water markets are bound to improve. For…As we know, India’s fragile and finite water resources are depleting while the multi-sectorial demands for water from sustained economic growth (over 8%) is driving the increased demand for water through coupled dynamics between increased energy and consumption. Exponentially increasing demand for water due to population growth and agricultural use, if left unchecked. Climate change and extreme climate variability are further likely to accentuate these numbers. In the future higher usage in the domestic and industrial domains is likely as the pace of economic development grows.
Even in the Water and Waste water sector, Global water companies such as Veolia Water, Suez de Lyonnaise (Degremont) and VA Tech Wabag, Nalco, GE Betz-Dearborn etc., have established a presence in India with many projects initiated or underway worth several billion Euros; only to signal what potential this segment is going to offer and will auger well with the pump industry at large and KSB in particular!
Additionally, other segments which currently offer opportunities are the energy Segment – mainly in the Nuclear and Supercritical power generation arena and FGD business which is emerging and will to offer some opportunities in the near future. Along with this, Solar pumping is a growing domain in the Indian Market.
With a good monsoon this year, we are hopeful that the upstream industries and the Agriculture Segments will also get a Philip and auger well for the Industry.
Globally, the manufacturers are embracing the trends of Digitsation & Industrie 4.0 which is slowly catching up in India too amongst the big players. How are pumps and valves manufacturers responding to this changing demand and what are the challenges that need to be addressed? Please share the details on the work KSB has carried out in this space so far.
Yes Industry 4.0 is bound to catch vogue of the Indian manufacturing sector by the turn of this decade / mid next decade!
Industry 4.0 disrupts the current value chain and requires companies to rethink the way they do business. They need to drive the digital transformation of their business to succeed in the new environment. Five pillars will be critical for this transformation: first, companies need to build digital capabilities. This comprises factors such as attracting digital talent and setting up crossfunctional governance and steering. Second, companies need to enable collaboration in the ecosystem. This requires getting involved in the definition of standards and cooperation across company borders through alliances, strategic partnerships, and cooperation in communities. Third, managing data as a valuable business asset will be important in securing crucial control points. Fourth, companies need to manage cybersecurity end to end to protect digitally managed shop-floor operations and proprietary data. Lastly, companies need to implement twospeed systems/data architecture to differentiate quick-release cycles from mission-critical applications with longer turnaround times. To leverage these multiple opportunities, companies need to embark on a digital transformation journey: a continuous, long-term effort is needed to successfully navigate the changing industrial environment of Industry 4.0.
We at KSB in India have taken our baby steps in this direction, first, by pursuing simpler e-commerce and marketing automation initiatives to start with; and intend to be abreast in this morphing digital arena; as we also see our markets mature to this concept!
Presently, with five manufacturing facilities, KSB is among the top manufacturers in India. How do you plan to lead the growth of company in India and what are the plans for the future?
The breadth of KSB India’s product portfolio addresses the needs of myriad customers... KSB in India has been; and continues to be a trendsetter pumps for virtually all conceivable applications through her Technological leadership and solid German heritage.
These include pumps for customers from basic domestic water, to supply and consumption of water in commercial buildings and offices including that for HVAC purposes and firefighting. Moving towards Industry, KSB pumps are a heart of the process! They reliably transport fluids ranging from Industrial water to acids to viscous and solid laden liquids and abrasive solvents with ease. In the Refinery and Petrochemical sectors, cryogenic and explosive media is handled with great finesse. In the Power sector, be it a Conventional or a supercritical or a Nuclear Power plant, we save energy while helping the nation to generate more. And to keep our fields green, our pumps romance the life giving element- water, with great panache.
As mentioned above, KSB has its strength that it covers all the market segments with its products. This is very significant at a time when some markets are not doing so well and it gives us this flexibility to focus on other segments. We are at present putting a lot of focus on our Standard business, and also the aftermarket business. We hope to grow our business substantially in these areas and we are also planning in to add some new products to fuel our growth.
We are also cautious and optimistic in the Solar Pumping arena! While we are closely observing the central governments initiatives in this direction; we are simultaneously gearing ourselves with products; including introducing suitable products top address this need.
KSB in India has been and will continue to support the “Make in India” philosophy. To this, we are investing heavily in a brand new and an ultramodern manufacturing facility near Pune, to take care of the future demands and indigenous supply of critical pumps for the of the Super Critical and Nuclear Power Stations, which were partly or fully imported. As mentioned earlier too, we are also looking at the FGD markets which are evolving in India and where KSB have a strong and proven presence worldwide.
KSB in India is a part of the Global Manufacturing Network of the KSB Group; and due to her cost advantages, is also poised, not only to be a formidable Exporter in the Asia Pacific Region, but also to other group companies in the World in the coming years.
KSB in India is indeed a “One Stop Shopping Centre” when it comes to delivering value to the customers with reliable pumping solutions to what-so-ever or how-so-ever the application may be! India is a promising market for KSB and we also are gearing up to tap the opportunities it offers and to remain “Ahead of Time … all the time”.