We have tied up with manufacturers to come up with innovative schemes whereby maximum benefits can be passed on to the customer and we can bring the momentum back into the industry, says GC Rangan, Chief Operating Officer, L&T Finance. Excerpts from the interview.

How are you equipped for the current slowdown?
The industry is going through a challenging phase, and being an expert in construction equipment categories with experience ranging over 20 years, we know this kind of economy. We have to have a determined structure which is more suitable to the cycle and the income of the customer, and this pattern varies from equipment to equipment. So earning from backhoe loaders would differ from earning from excavators; it differs during different seasons and in different areas. So, this is what we are taking care of. We have tied up with manufacturers to come up with innovative schemes whereby maximum benefits can be passed on to the customer and we can bring the momentum back into the industry. We are also looking at exploring leasing opportunities and most likely, it will be on board soon.

How do you view the current market trends?
We are working very closely with manufacturers and others in the value chain. In the following months, I am sure there is going to be a lot of activity in construction, especially, in the second quarter of the next financial year. Recently, the Cabinet Committee has taken active interest in a lot of processes and it will take about three to six months to reflect on the ground.

What is your core focus area in equipment finance?
In fact, we would not like to focus on one particular area. We are present across segments and we have the necessary expertise and funding experience across these segments. The underlying fact is the quality of the project.

What is the percentage of your business in equipment finance?
We must see this in relation to the industry numbers. For excavators, we have 7.5 to 8 per cent of the market. For backhoe loaders, we have about 2 per cent. So, for different segments and products, we have different market share. In the last 18 months, numbers have dropped across the board, and obviously our number also dropped.

What is the strategy you have adopted to stay in the market?
Our strategy is very simple. Feasibility for the customer is of prime importance. It is just not only financing. What is the customer up to? How profitable are his projects? How is this business cycle? We have to really marry the schemes in such a way that factors in his affordability, his earning per machine, and his capacity to repay. These are the points which we will now start engaging very closely with, for all our customers. It will be an ongoing exercise for us. Considering all these aspects, we provide the best solution to the customer, understanding his needs, the project, and reasons for buying the machine, whether he is going to be a subcontractor or contractor.