• PAGE ONE
• INDEX
• HOME

Product portfolio expansion -- BEML in talks with MNCs

Janaki Murali

BANGALORE, Aug. 28

THE public sector unit, Bharat Earth Movers Ltd (BEML), will soon become a one-stop shop, offering all earth moving equipment necessary for mega road projects and towards attaining this goal, BEML will add products not yet in its portfolio, by strategic tie-ups with multinationals.

Dr. K. Aprameyan, Chairman and Managing Director of BEML, told Business Line that the company was in talks with Steelfields of the UK for supply of batch-mixing plants; with Kawasaki of Japan for pavers and Europactor of Spain for vibrator compactors, co mmonly known as road rollers.

These tie-ups will help BEML become competitive in an industry facing threat from Korean dumping and keen competition from several multinational companies.

The one-stop shop concept is increasingly being talked about in the industry as an answer to contractors, who are awarded mega projects and who can look at one company for all their sourcing needs, instead of buying equipment from several companies.

With the Prime Minister, Mr. A.B. Vajpayee, reiterating in his Independence Day address his Government's commitment to the North-South and East-West corridor projects, the PSU is hoping to get a fair slice of the pie from these contracts.

The National Highways Authority of India's North-South (Srinagar-Kanyakumari) and its East-West (Silchar-Borbandar) corridors comprise 6,300 km in length of which around 10 per cent has been completed.

The other major project of the NHAI is the much-talked about Golden quadrangle -- connecting the four metros -- from Delhi-Calcutta-Chennai-Mumbai. Of this stretch comprising 5,950 km, 10 per cent has been completed.

And while BEML is sprucing itself to face up to the competition especially from multinationals, the recent decision from the World Bank to scrap the second phase of coal sector modernisation project involving Coal India, is likely to come as a blow to BE ML, which has been able to bag a fair share of the World Bank-related Coal India projects till date.

However, according to Dr. Aprameyan, orders from the defence sector had picked up, with nearly 30 per cent of its business coming from this sector. For instance, in 1999-2000, the business from defence was worth Rs. 270 crores.

Considering the mixed future of the industry, it has to be seen whether BEML makes good its promise of a target of a Rs. 1,350-crore turnover with a profit before tax of Rs. 40 crores for 2000-2001 and a turnover of Rs. 2,000 crores in the next five year s. BEML's pre-tax profit in 1999-2000 was Rs. 22.5 crores from a turnover of Rs. 1,316 crores.