Vivek Hajela, Vice-President and Head – Construction Equipment Business, Larsen & Toubro Limited, shares the current market size, and growth potential for compactors in India.

Roads and highways are one infra sector that was back in action faster, after the Covid-19 pandemic impacting the overall industry and economy.

How optimistic are you in the sector in terms of project execution and growth?

The Ministry of Road Transport and Highways (MORTH), under the leadership of Minister Nitin Gadkari, has given a clear indication that there will be renewed thrust on road construction. The month of April 2020 saw the sales hit due to the nationwide lockdown. Since then month on month, the sales have improved. In fact, during the months of Oct-Nov’20, sales of Compactors surpassed the corresponding period last year by around 20%. This is an indication that normalcy is fast restoring in the Road Construction Sector. The migrant labour is returning to most worksites and the speed of execution has picked up considerably.

The revival in demand for construction equipment will depend primarily on the pace of execution of these projects with MORTH giving adequate thrust on Infrastructure segment. We have seen the award of large-size road contracts even during the lockdown. MORTH is looking at awarding more than 8,000 km highway construction contracts in FY2020-21.

Further, stimulus package from Government of India will support revival of the economy and the demand to pick up. L&T Construction Equipment Limited, which manufactures Compactors and other Road Machinery, is fully geared up to meet the market demand.

How does technology play a major role in the faster execution of roads and highway projects at the desired quality standards?
L&T’s focus on road machinery is due to the emphatic role mechanisation and technology have in the faster execution of road construction. L&T’s Product Development Centre (PDC) has indigenously designed the machines that are highly suitable for the Indian market. L&T 9020 wheel loader was one of the first machines designed by the PDC and has become a popular choice in the loader segment. Over 2,300 machines of wheel loaders have been supplied over the years in the Indian market and are effectively deployed for various applications. PDC has the capability to design and develop the machines by integration of structures, hydraulics, electricals, aggregate selection, matching as well as building prototype and validation. L&T 1190 Soil Compactor was developed indigenously by PDC and over 1300 nos have been supplied.

L&T 990 HF is 10 T Tandem Compactor and has advanced design features like the suspended frame design and is the only machine in the Indian market with engine housed in a separate rear compartment, making it easy for servicing. Th e machine has a balanced weight distribution of 5 Tonnes each on the front and rear. L&T 491 Mini Tandem Compactor, which was also developed by PDC, has a population of 400 numbers.

L&T 2490HD Pneumatic Tyred Roller helps in sealing the Road surface. In a span of 3 years from its launch, over 30 units have been supplied in the market. Skid Steer Loader L&T S315R, a utility machine developed by PDC, works effectively in confined spaces. In recent times, a new model of Wheel Loader, L&T 9020SX, designed and developed by PDC ha become popular with users. The model with better torque characteristics and a better cabin has brought down the operating cost for the customers. Over 300 machines have been supplied in the market since launch of this model.

Hydraulic Sensor Paver, L&T 5590, is another product which has been designed by PDC and is undergoing user trials. Th e Hydraulic Paver is much sought aft er by the road contractors who need paving as a basic function to be carried out during road laying. Th e machine is capable of paving upto 5.5 Metres.

L&T’s Product Development
Centre has the requisite knowhow and application expertise to develop machines which are well engineered to suit the tough local conditions.

What is the current market size of compactors in India?
The current market size for the compactors in India is annually in the range of around 4,000 to 4,500 machines. Th e majority of this market is the 10T soil compactors which makes up the bulk of the requirement.

The market size will continue to expand and will support players who have the capability to introduce new models with cost effective technology.

The market for compactors will continue to grow due to the thrust MORTH has given on the execution of the road projects. Minister Gadkari is highly optimistic about accelerating the pace of execution which would drive the demand for more equipment. The market for the mini compactor is also gaining popularity with market size of about 750 units.

How do you assess the growth potential for compactors in India?
L&T compactors are very well established in the Indian market and has good potential in the overseas market as well. Th e growth potential for the road equipment will remain robust and will show an upward trend in the years to come. With the plans of MORTH to increase the pace of execution, the offtake of compactors will surely grow.

What are the challenges faced in the industry you are in?
Th e BS-IV norms for construction equipment will come into effect from April 1, 2021 and the notification for suggestions from stakeholders has been published by MORTH. While we are closely working with engine OEMs and trials are on, there is a process of validation to be followed with various testing agencies. These agencies will validate the engines and ARAI will surely extend help by expediting the validation process. These BS-IV norms make the equipment more environment friendly. Th is is a big technological upgrade and will have a major impact on cost of the equipment.