Based on 135 years of engineering and technology leadership, we supply a complete array of products, systems and services, ranging from single engineered and customised equipment, such as vertical mills, kiln systems and clinker coolers to a complete cement plant with full-scale operation and maintenance. Our experienced process design department can handle all the requirements of fully integrated cement plants – sample testing, equipment sizing and operation to environmental compliance. Our aftermarket services include training, spares, mechanical and process audits, upgrades and complete operation and maintenance. We offer our customers everything it takes to design, build and operate successful plants.
Carsten Riisberg Lund, Country Head – FLSmidth India shares his view with Sandeep Sharma about his organization, people, process, core competencies, holistic solutions for cement plants, effective solutions, major clientele, impact of GST, immediate and long term growth plans in India and lastly Cement sector outlook for 2017.
Could you tell us about your company, people, process, and core competencies?
FLSmidth is a full-service provider of sustainable productivity-enhancing solutions to the global cement and minerals industries. 'Full-service provider' means supplying everything from single products and services to complete plants or production lines and full operation and maintenance solutions. We support customers with all aspects of their production.
We focus on cement, coal, copper, gold, iron ore and fertilizers, providing one source for the products, complete solutions and services they need. With offices in more than 50 countries and 13,000 employees worldwide, we are on the spot locally to help customers with every stage of their operational process, from strategic planning to overcome everyday challenges and facility lifecycle management. We have also opened an office in Nepal recently to be closer to the customers and ensure localised service.
We are celebrating our 135-year anniversary this year. And in India, we have been doing business for more than 100 years. The Indian operations of the company are based in the state-of-the-art and LEED certified facility in Chennai in addition to four regional offices in Mumbai, Gurgaon, Kolkata and Hyderabad.
Our manufacturing units in Haryana and Tamil Nadu support the entire FLSmidth Group to serve the domestic and international customers of global cement and minerals industries. With 3000-strong workforce, India is a major project and technology centre for the Group.
We strongly believe in a collaborative approach to R&D. We increasingly develop solutions together with customers or form partnerships with other industry process leaders like the joint development with one of the catalysis experts HaldorTopsøe A/S and with world leading chemical company BASF GmbH to ensure a targeted co-development with rapidly commercialised products.
What kind of holistic solutions do you provide with regard to setting up medium to large size cement plants in India?
Based on 135 years of engineering and technology leadership, we supply a complete array of products, systems and services, ranging from single engineered and customised equipment, such as vertical mills, kiln systems and clinker coolers to a complete cement plant with full-scale operation and maintenance.
Our experienced process design department can handle all the requirements of fully integrated cement plants – sample testing, equipment sizing and operation to environmental compliance. Our aftermarket services include training, spares, mechanical and process audits, upgrades and complete operation and maintenance. We offer our customers every-thing it takes to design, build and operate successful plants.
We also constantly cater to the increasing demand of turnkey deliveries with Engineering, Procurement and Construction (EPC) service, based on our 135-years of specialist know-how and sustainable business model.
How far your solutions are effective in increasing the existing cement plant efficiency, output and green compliance?
We constantly aim our efforts to improve the product portfolio to fulfil customers' needs for innovative solutions, high reliability, minimum environmental impact and the lowest possible lifecycle costs.
Some of our energy efficiency advancements include ATOX® and OKTM vertical roller mills, hydraulic roller press, FLSmidth® Cross-Bar® cooler and low pressure cyclones for preheaters. We have also JETFLEX® burner and HOTDISC® combustion device which help to increase the usage of alternative fuels.
Pollution control equipment, both in terms of particulate emissions and gaseous emissions such as NOx and SOx include Low-NOx™ calciner and the FLSmidth® SNCR (Selective Non Catalytic Reduction) system. Our other air pollution control products are electrostatic precipitators and bag filters.
Further, we have ECS/ProcessExpert® which is an advanced process control solution. It stabilises the plant, optimises production, manages and corrects process disruptions and minimises wear on the plant equipment to ensure highly efficient and optimum plant performance. It continuously computes new control set points, enabling ECS/ProcessExpert® to make adjustments to the process more frequently and reliably than a human operator.
How did your company fare so far in terms of business generated, growth rate achieved and your expectations from the current financial year?
The overall economic condition in the country coupled with a misaligned demand and supply situation in the cement industry resulted in modest growth. But, we have maintained our business volumes at a healthy state as there were increased activities in some market segments during the last couple of years.
We have been able to bag a fair share of the available orders in our core markets and our service business saw an increasing level of cement- and mining-related business. Consequently, as a whole, FLSmidth India is a very well performing unit.
Given the positive performance, we continue to expect that we will be able to achieve our short- and mid-term objectives. Our approach is to collaborate and leverage synergies to seize maximum opportunities in the market. And with our strategy, we are moving in the right direction.
Who are your major clientele in the Cement sector? Could you share with us details about your prestigious cement installations in the last one year?
FLSmidth has delivered the first cement plant in India in 1904 and we have supplied more than 100 kiln systems in India. Some of our major customers are Ramco Cements, Chettinad Cement, Bharathi Cement, Holcim-ACC, Dalmia Cement, JK Cement, Ultratech Cement, Heidelberg and Holcim.
As for the second part of your question, we have, for example, commissioned 6000 tpd cement plant for Orient Cement. The plant has our products such as hydraulic roller press and OKTM vertical roller mill, which makes it a highly energy efficient one.
We have also supplied 1.2 MTPA grinding unit to MyHome Cement Indus-tries, just in 14 months. One of our turnkey projects includes 1 MTPA grinding unit for Oman Cement in Oman, which we have commissioned last year.
What can be the impact of GST on the cement industry in India?
There are broad-based expectations for revenue generation with reduc-tion in tax rate and rising industry utilisation. GST will bring the tax rates down to 18-20% from 27-32% and it is likely to have a positive impact on the Indian cement industry. The low GST is expected to lead to savings in transportation cost, as cement industry is heavily dependent on logistics. But, it is too soon to know the actual impact.
Could you comment on the Cement sector outlook for 2017?
Cement demand continues to grow, although not by enough to outweigh supply additions and after several years of overcapacity. New capacity additions are slowing down and the impact of demonetisation is likely to delay the recovery of utilisation levels.
The rising fuel prices coupled with reduction in price of the end-product led customers' to primarily focus on optimising their costs and increasing their productivity. The investments in separate grinding units closer to the end-market and plant upgradation are seen as a way to optimise the freight and manufacturing costs respectively.
Going forward, what are your immediate and long term growth plans in India?
We are known for our reliability, project follow-through and competent people. Nevertheless, improvements are always possible and we are extremely focused on ensuring that our customers always get what they expect and when they expect it. Our people are hands on! We are on the field, close to the customer and work on the solution to provide what our customers want.
We have defined the direction of the Indian organisation in alignment with our global strategies, which have already begun to show positive signs in our business. We are confident in our framework and we are focussed in moving forward.
Based on a unique combination of projects, products and a broad service offering, FLSmidth is ideally positioned to help customers enhance all dimensions of productivity. Our innovation is aimed at developing better alternative technologies and optimising the performance of existing plants and equipment. We will drive success through sustainable productivity enhancements.