-Priyanka Gupta, Executive Director,
MPIL Steel Structures Ltd
MPIL Steel Structures is a turnkey solution provider for metal
building products and integrated structural steel fabrication. Over
the last decade, MPIL has emerged as a leading manufacturer of
complex steel structures, pre-engineered buildings and fabricated
solar panel mounting structures.
Priyanka Gupta tells
Sandeep
Menezes that design, weight and fixing technology of solar panel
mounting structures will have to change according to the
modification required for every building.
MPIL was already into PEB therefore moving into solar panel
mounting structures was the next step.
There are many reasons for it; we have a world class
fabrication unit. We can do many different heavy and light
structure fabrication - cold rolled forms and hot rolled forms in
our factory. Because we can do that our factory is an adaptable
factory with many different machines.
Our management team always had a vision to be into
renewable sources and we could maneuver our factory to the
changing needs.
We are excited about solar and sure about the benefits that
green energy initiatives will bring the nation. Therefore, we
want to be known as a company that pushes for the role of steel
in green projects.
Do buildings need to conform to certain structural specification
before mounting solar panel structures?
If we want to promote solar on roofs then existing buildings will
need to be targeted - therefore how ever the existing roofs are
designed, the solar mounting structures will have to be
modified accordingly. The design, weight and fixing technology
will have to change according to the modification required in
every building.
Therefore our in-house team will be able to do retro
fitting on the roof surface of any building irrespective of
roof or building type. Even if your building is surrounded
by other buildings on all sides and does not get
proper sunlight - we have developed devices that can tackle
this situation.
Do you foresee demand coming from only metro and tier 1 cities
or also smaller towns?
Right now most of the solar farms coming up are situated in
rural areas and uninhabitable terrains like Kutch and
Rajasthan. Such solar farms will thrive in areas that were not
utilized for anything in the past.
Prior to MPIL introducing solar mounting structures in India,
what was the earlier technology?
Earlier people used to import solar mounting structures from
Europe into India and it was very expensive. With prices of
solar projects coming down due to bidding - it was important to
find lower cost and high quality local alternatives. Therefore
such solutions needed to be developed in India.
What is the cost difference between MPIL's solar mounting
structures and the imported products?
The difference is as high as 40 per cent. Also many European
countries were manufacturing in aluminum before they opted
for steel. Currently we are the only company manufacturing
solar mounting structures in India.
What is MPIL's long term vision in the solar sector?
We want to become one of India largest steel structural
manufacturing companies. Our Tarapur plant capacity is
currently fully utilized.
We are about to inaugurate our new plant in Karnataka - it is
spread over 23 acres and have capacity of 60000 tonnes per
annum of finished structural steel. Our immediate plan is that
that plant must go live in all phases.
In future, we want to set up one plant each in Gujarat and
Rajasthan, and cross around five lakh to 10 lakh tones of
structural steel per year.
We have not found land in Gujarat yet - so we are still looking.
It can be anywhere in the GIDCs - this plant will be for
structural steel.
The proposed plant in Rajasthan will also be for structural
steel. We are hoping that one of our facilities either in Gujarat
or Rajasthan will be a special facility for solar mounting
structures due to the proximity to solar farms.
How will it take for both these plants to commence operations?
It will not take too much time. In GIDC, there is single window
clearance - once we select the land the rest will follow quickly. Once
we get the land the plant should go live within next six months.
Gujarat plant will happen first in approximately six months
to one year - the Rajasthan plant will follow later in around
18 months.
Together, the Gujarat and Rajasthan plant will require an
investment of around Rs.200 crore. Out of this, around Rs.110
crore will be for Gujarat project and the remaining for
Rajasthan project.
How are the projects funded?
For Karnataka, we have gone for the traditional debt route. We
are open to PE talks and various other investment options and
see what works out best. We are in various talks right now.
What is the current scenario in India's PEB market?
PEB has recently started out in India and hence is still at a very
nascent stage. All the new buildings, warehouses, factories,
high-rises, commercial complexes, hospitals and hotels and
airports will be made of PEB. The future of PEB is humungous
therefore it is tough for me to put a number to it.
When I mean pre-engineered buildings - I mean predesigned
buildings which have less work on the site. All the
work needs to be pre-engineered, pre-planned and optimized
thereby there will be only bolting work at site - no civil or
concrete work require on site.
How much future growth do you foresee in India's PEB market?
The market is growing multifold every year - its more than
quadrupling. Even in construction, let's say an airport project
had four phases wherein the first phase was designed in
concrete four years ago - even the remaining phases are being
designed in PEB.
Some PEB players feel that there is an over supply in the PEB
sector.
It is a healthy competition scenario. I don't think there is an
over supply in the PEB market. If one imagines the number of
buildings still coming up in concrete - it is under utilization of
the country's steel capacity. There is enough demand for
various PEB developers developing different skill-sets.
Tell us about the main drivers for PEB growth in India.
It is a combination of many things. Like India still does not have
many airports, train stations, metros and ports. If all such
projects have to be taken up massively, quickly and with cost
efficiency - it has to be done in steel. Until now, that national
level planning itself has not been achieved.
In China they are building cities within days - it is mostly done
in PEB. That kind of speed is yet to be witnessed in India.
Steel prices has been rising continuously, tell us about the
impact on margins across the industry?
The price of steel has in fact crashed in the last few months. The
margins are not net-to-net. There is an entire package and not
only cost of fabrication - it also involves cost of designing that
building that is very high. We have to use expensive software's
and talented designers - also execution team. There are many
levels of cost involved. Of course, if steel prices rise then those
additional costs will be passed on to the customer.
Does cost of steel price fluctuation actually get passed to the
customer?
We prices are quoted to customers as on date the projects are
bagged - the prices can't be made higher later. If I have bagged
a contract two years ago - the prices were are per the cost at
that time. If I quote for a project today - it will be as per the cost
to be incurred today. Also if I am quoting for a project today -
then I am booking my raw material today against that order.
You were speaking about China, I wanted to point out that
steel prices out there are largely state controlled unlike in
India. Comment.
China gas an advantage in many ways, they are a communist
nation. In India also prices are uniform - its not like different
players have different prices. People are working not only in
tandem with local forces - they are working in tandem with
global forces.
Do Indian customers only look at initial cost or also evaluate
on quality?
Indian customers are becoming very savvy, hiring consultants
and investing in their projects. They want good and total
solution from one company. The customer is becoming quality
conscious and wants good service at good price point.