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Beml plans to double turnover
Arusha Das
With the country’s industrial sector poised for a
quantum leap, the outlook for India’s mining sector
is bright, triggered by strong domestic demand.
BEML Limited, one of the leading names that come to mind
in the Indian mining equipment industry, is all set to tap
the long-term prospects of the industry. The company plans
to penetrate further into the market both in the domestic as
well as in the global segments. For that, it intends to increase
production on one hand and on the other, tap newer markets.
The leading manufacturer of heavy earth moving
equipment has a capex plan of `180 crore this fiscal and a
similar amount next year. “We plan to double the current
turnover to `7000 crore. The fastest-growing segment will be
mining and construction and there will be some growth in
defence too,” a company official told Coal Insights.
The company has recently formed a joint venture with
Mineral Exploration Corporation (MECL). Referring to this,
the official noted that there are over 200 to 300 coal and noncoal
mines allotted to the private sector which need someone
to offer consultancy, mine planning and exploration services
to them. It was to tap these huge opportunities in the domestic
market that the JV was formed. In addition to this, the company
will also be providing drilling equipment through this JV.
BEML, along with Coal India (CIL) and Damodar Valley
Corporation (DVC), has also acquired the plant and machinery
of Mining and Allied Machinery Corporation (MAMC) in
Durgapur in August 2010. BEML will have a 48 percent stake
and 50 percent voting rights in the new joint venture. The
company will leverage the assets, technology and expertise of
MAMC in the new business. MAMC, which was 100 percent
owned by the Ministry of Heavy Industries, has now been
renamed MAMC Industries. The plant had been shut for eight
years. The West Bengal government has agreed to give BEML
BEML product basket
BD475 BD355 BD355X BD155
Crawler Dozers BD155X BD230 BD80 BD65X
BD65-1 BD65 BD50 BD31
Wheel Dozers BD46W BD30W-1 BD14W
BE1600 BE1000-1 BE1000E BE700
Excavators BE300LC BE220 BE220LC BE220X
BE200
BE71
BH100 BH90 BH85-1 BH70 BH60
Dump Trucks
BH50M BH40 BH35-2 BH35
MT4400AC MT4400 MT3700AC MT3700B MT3600B
MT3300AC MT3300 MT3000
Loaders BL200-1 BL656-1 BL636-1
Backhoe Loaders BL9H(4X4) BL9H
Source: BEML & Insights Research
land on lease for the plant, which will make equipment for the
steel and power sectors and underground mining equipment.
“We plan to restart the plant soon,” noted the official.
Meanwhile, with the intention to diversify and foray into
new segments, the company has recently opened a new plant
in Palakkad, Kerala, to manufacture components for railway
coaches. It is spread over 375 acres of land and has a builtup
area of 2 lakh sq ft. The investment on the new plant was
about `150 crore, and the project was completed in 10 months
from the day the land was handed over to the company. In
phase II, BEML will spend `140 crore, and it is now waiting
for the Kerala government to give them 600 acres before
they start work. In addition, BEML is also expanding two
facilities in Mysore and Kolar gold fields, where the company
manufactures heavy vehicles used by the army in deserts
and hilly terrain, at a cost of `180 crore. The company will
commission them in the next fiscal.
In addition to this, the company has just come out with
an 80-ton aluminium wagon for freight corridors, for which
Nalco supplies the material. BEML is also in the process of
building a 100-ton stainless steel wagon with SAIL. The
company is also looking at high-speed and medium speed
trains. The company now has four units, including the new
Palakkad one. Of these, the KGF complex and Mysore unit are
involved in producing mining equipment which account for
60 percent of the total equipment produced by the company.
The company’s earth moving division (EMD) at Kolar Gold
Fields (KGF) is located about 100 km from Bangalore. It is the
biggest manufacturing plant of BEML catering to design and
development, manufacturing, testing and after-sales service of
earth moving equipment and its aggregates.
The company is also secured in terms of raw material.
BEML’s subsidiary company, Vigyan Industries Limited,
produces casting which caters to the in house requirements,
while the remaining is sold in the open market.
The company has posted a growth of 18 percent in the
sales to `3557.67 crore in 2009-10 compared to `3013.47 crore
in the corresponding period in the previous year. The value
of production also posted a growth of 12.5 percent, reaching
`3708.66 crore in the financial year 2009-10 compared to
`3294.19 crore in the corresponding period in the previous year.
Despite the notable increase in sales volume, the profit
took a hit owing to low metro car sales, lesser quantum of
sales of spares and lesser turnover of exports coupled with
severe competition that had pressure on the margins. There
was drop in exports on the account of global recession and
also many orders could not be converted into LC owing to
fund constraints with the customers. However, the company
has increased its international presence from 55 countries to 56
countries and added Brazil to the list. It has also initiated steps
to maximise the profits.
COAL INSIGHTS 16 October 2010