We aim to improve our global market share across all business segments: Triveni Turbines
- January 29, 2021
Triveni Turbine Ltd is India’s largest manufacturer of industrial steam turbines with a dominant share of 60 per cent in the domestic market, and an impressive international presence. In this exclusive interview, we have Arun Mote, Executive Director & CEO, Triveni Turbines, discussing a wide range of issues spanning from the innovative steps that the company took to limit the pandemic impact to how the company’s plans to improve its global market share across all its product segments.
We understand that Triveni Turbines could limit the business impact of the pandemic through innovative proactive steps. Please discuss.
During these unprecedented time, Triveni Turbines gained significant share in the market and holds No.1 position globally in terms of number of units sold in nine months of 2020 compared to No.2 position in 2019, according to an international report.
These are highly encouraging rankings, which underscore the company’s inherent resilience. Along with our cost leadership, our product development and innovation capabilities have helped us achieve this competitive positioning.
The company witnessed a massive scaling up of its competitive strengths in FY21, as we have invested in more digitally advanced software and automation-led platforms. We were quick enough to devise plans of “Virtual Customer Connect” and are closely tracking and engaging with customers through webinars and techno-commercial meetings.
Our aftermarket business, Triveni REFURB, has also successfully upgraded and enhanced efficiencies of both European and Chinese OEM turbines located in different countries. We have also successfully completed refurbishment of compressors, utility turbines (up to 300 mw) and generators for our customers.
From supporting Triveni’s aggressive transformation during the COVID-19 crisis, to paving the way for further reinforcement of its digital security architecture, this technological empowerment promises to be a game-changer as we move towards the post-COVID era.
Has the situation now broadly reached pre-pandemic levels for Triveni Turbines?
The COVID-19 had an impact on our business in the first half of FY21 due to the global economic slowdown. But the company is confident in the underlying resilience of its businesses and operating model.
The performance of the company during the second quarter started showing signs of improvement and the turnover and profitability also increased. This bodes well for the business as the addressable markets have started showing positive momentum from second quarter onwards although the pandemic is still impacting the overall global economy.
The restriction on travel and movement of raw materials, finished goods etc. has been easing out in many countries globally resulting in improved dispatches and order booking. We expect this trend to gain further momentum in the second half of this financial year.
With our strong balance sheet, debt-free status and adequate cash, we are confident of covering our liquidity needs, going forward. We aim to improve our margins and global market share across the business segments.
Aggressive digitalisation in all aspects of the business shall be the way forward. The past 2-3 months have seen our teams equip with latest digital tools and applications for achieving the business objectives by using the ‘new normal’ means. Cumulatively, we feel these efforts shall translate into greater “normalcy” and revival in the months ahead.
We understand that Triveni Turbines is a global leader in turbine sector in the 5-30 mw turbine range, please give us an idea in quantitative terms.
Triveni Turbines is an original equipment manufacturer (OEM) of steam turbines in India with dominant market share in the domestic market. We are proud that we are one of the very few companies who manufacture and assemble steam turbine in-house adhering to the International quality standards.
With more than 1 billion operating hours of turbine fleet, the company has installed over 4,000 steam turbines generating a total power generation capacity of 13 GW across 20 industries. Triveni is present in over 70 countries around the world.
Triveni REFURB team on the other hand works globally across all brands of rotating equipment leaving a positive footprint on repair, spares, overhauling, efficiency improvements etc, up to 300 mw.
What percentage of your sales goes into the renewable energy sector – biomass, waste-to-energy, bagasse-based cogeneration, etc? How do you see the outlook from the renewable energy sector?
Increasing demand for renewable energy sources is seen as the growth trend for steam turbines globally. In the domestic market too, the Government of India has been consistent in promoting biomass power, bagasse-based cogeneration programme and more recently waste heat recovery and municipal solid waste power generating solutions.
TTL is one of the largest manufacturers of small steam turbines (0.1 mw to 30 mw) in the renewable energy sector globally. Nearly 65 per cent of our business currently comes from non-fossil/renewable energy. In the export business, renewables sector is driving demand especially from biomass and waste-to-energy. In the domestic business, order finalization were mainly from sugar co-generation (bagasse), biomass and in waste heat recovery.
Globally, governments are shifting from conventional to renewable sources of energy to attain renewable energy goals. The turbine industry, with its large manufacturing base, is also moving aggressively towards energy conservation, and use of renewable sources.
How do you think the energy sector can benefit from the technological expertise by Triveni Turbines?
Increasing focus on replacement of existing coal-fired power plants with clean fuel generation, in order to reduce carbon footprint, will further augment the demand for renewable power generation business in the future.
With either changes in requirement of the process or age, the turbines become inefficient and adversely impact overall costs. Our REFURB team, using specialized 3D scanners, develops the drawings required for any brand/make of turbine, to enhance the efficiency of existing turbines of the customers. The customers receive up to 15 per cent improvement in efficiency with the existing turbine with no change in the civil foundation. A ROI of under two years and life extension of up to 100,000 hours.
Why should companies focus on captive generation than MW-scale power plants, as per the product design of Triveni Turbines?
Globally, the captive power generation for industry is expected to remain strong, owing to the increasing demand for power from emerging industrialized economies such as China, India, Africa and Middle East, which offer subsidized rate per unit cost of power generation.
In India, the widening power supply-demand, increasing investments in the industrial sector in the remote areas where power transmission & distribution infrastructure is unviable, rising input costs (energy) and electricity prices, coupled with stringent Government regulations are expected to drive investment in the establishment of captive power plants.
The largest market for captive power generation in the country is the industrial sector, mainly on account of the increasing demand for electricity from energy-intensive industries such as cement, petroleum refining, chemicals, iron & steel, etc.
The need for continuous uninterrupted quality power supply for sustainable industrial operations, backed by continual improvement in coal supply will enhance captive power additions in the country. Secondly, utilizing the waste heat from the industrial processes for generating two streams of energy viz. steam and power for captive consumption is proven economical apart from the optimization of the input energy cost.
Tell us about your global presence. Which geographies currently dominate your international business?
Export business accounts for 40-45 per cent of the TTL’s order booking. Europe, South East Asia and Latin America markets are some of the few regions expected to offer growth opportunities in the future.
TTL REFURB with its services across all brands will address customers in the global market making it “One stop shop” for all rotating equipment. Asia and Africa are expected to drive the growth for Triveni REFURB, which has entered new geographies such as APAC and have penetrated new industry segments such as geothermal and gas turbines.
Do you face competition from China-made turbines in the exports business?
Chinese steam turbine manufacturers are not our competitors and has not impacted on our business
Speaking of business operations, we understand that TTL recently undertook a manpower reduction exercise. Tell us more.
The company undertook a major rationalization programme of its manpower cost which could be achieved due to focus on higher automation resulting in improved productivity and better outsourcing strategy, all of which enabled the company to optimise its manpower strength. This has resulted in a one-time cost of Rs.18.5 crore, which has been accounted as “exceptional items” during Q2 of FY21, and the benefit of which will start accruing from the coming quarters. Multi-tasking and multi-skilling on the shop floor has been implemented and has already started yielding results.
(All industrial photographs relate to products and facilities of Triveni Turbine Ltd.)
