Sanghvi Movers to invest 275 cr in FY 23-24 in fleet expansion, says Rishi Sanghvi

Sanghvi Movers Limited (SML) is the largest crane rental company in India and ranked 6th largest in the world. In an exclusive interview to The Rental Time, Rishi Sanghvi, MD, Sanghvi Movers Limited shares SML’s journey in last three decades and talks about the expansion plans in the future.

1. How has Sanghvi Movers Limited’s journey been since its inception?
   
   In 1989, Mr. C.P. Sanghvi, the founder of Sanghvi Movers Limited, made his first crane import from the UK, specifically the Tadano TG 700E with a capacity of 70 MT. The company underwent an initial public offering (IPO) in 1995, generating proceeds of Rs. 17.50 Crores. These funds were then used to purchase a range of cranes, ranging from 160 – 450 MT.

   A significant breakthrough for SML came in FY 1997 and 1998 when it established a major partnership with Reliance Industries Limited. During this period, SML engaged in a capital expenditure (capex) exceeding Rs 50 Crores, importing 36 cranes from Singapore and chartered a barge for shipment. Over a duration of 18 months, more than 75 cranes were deployed for the construction of the Reliance Project.

   Subsequently, SML continued its journey, achieving various milestones along the way. The company consistently invested substantial amounts in capex to develop its world-class crane fleet over the years. Today, Sanghvi Movers Limited (SML) is the largest crane rental company in India and Asia, and the sixth-largest in the world as ranked by International Cranes (June 2022).

2. How are you seeing SML today in the market?

   Sanghvi Movers Limited is the largest crane rental company in India and Asia, and the sixth-largest in the world as ranked by International Cranes (June 2022). The Company has a pan India presence spread across 130 active jobsites and a network of 17 depots.  SML is the preferred business partner with a track record of safety, on time delivery, and customer satisfaction. The company has erected 15+ GW of WTG in the past 10 years and has started providing turnkey EPC solutions for both Project and Wind EPC.

3. What is the current fleet size of SML along with the categories of equipment and which are the sectors that SML is serving? Are you adding new categories to your fleet?

   The company owns more than 700 equipments including cranes, trailers, hydraulic axles, telehandlers, forklifts, and pick-and-carry cranes. The cranes range from 40 – 1000 MT. Our fleet is engaged in sectors such as thermal power, petrochemical and refineries, oil and gas, steel, cement, windmills, railways, metros, and bridges projects, and for construction applications like erection, heavy lifting, and maintenance services.  We have added a substantial number of cranes and will invest 275 cr in FY 23-24.

4. What is the current scenario of India’s rental industry? How is it shaping up for the future? What should be the focus of India’s rental industry?

   The Indian construction equipment (CE) industry has experienced significant growth in recent years and is poised to become the world’s second-largest by 2030. In FY 2023, it is estimated that the industry achieved a remarkable 25% year-on-year growth, surpassing 100,000-unit sales for the second consecutive year.

   The crane rental market in India is expected to register impressive growth. This growth is backed by the government’s focus on building world-class infrastructure. In the FY 2023-24 budget, capital investment outlay for infrastructure was increased by 33% to Rs.10 Lakhs crore (USD 122 billion), which amounts to 3.3% of GDP.

   In the refinery and Petrochemical space nearly 80.1 million tons per annum of capacity enhancement, brownfield and greenfield projects are coming up. In the thermal power sector, plants of 25.5 GW total capacity are at various stages of construction in the country. In the steel sector there is 13.7 million tons per annum of capacity addition. The cement industry plans to add 80 million Tons (MT) by FY 24 which is the highest in the last 10 years. In FY23, the industry added 2.3 GW of capacity addition in the country and there is strong traction to double that number in FY24.

5. How are EPC/Turnkey projects helping the rental industry? What are the advantages of EPC projects as compared to renting?

   As a pioneer in the crane rental industry, Sanghvi Movers realized that one of the biggest challenges for the industry was completing projects on time with good vendors. To leverage the upcoming opportunities, we have started offering value added services such as engineering, lift planning and turnkey EPC solutions. Our customers are keen to work with a company that has a reputation for delivery, a good track record of safety, and the highest quality of manpower and equipment. Some of the advantages of EPC projects compared to renting are that we could provide cost savings solutions to our clients, have long term revenue visibility, and diversify our range of service offerings.

6.  Operators and other workforce deployed on the equipment are not professionally trained rather they train themselves quite informally. What are your views on this?

   Successful and timely completion of works depends not only on hi-tech equipment/cranes but also on operators’ skills. Sanghvi Movers Limited, in the past, had established a Crane Training Academy for the training and development of operators. Being the pioneer in the crane rental industry, we realized that one of the biggest challenges for the industry was finding qualified operators. Hence, Sanghvi Movers has been training operators not only for its own use but also for industry at large. In addition, we work closely with all OEMs to provide on-site training. Investing in comprehensive training programs demonstrates a commitment to employee development and safety, while also contributing to the overall success and reputation of the company. SML is also focused on an in-house apprenticeship program where operators with 25-30 years of experience train and guide newer operators over the course of 3-5 years. Some of our efforts include:

• Conducting classroom and practical lessons
• Providing special GWO training for our Wind division
• Offering site safety briefings
• Organizing periodic training sessions for riggers
• Providing first-aid and CPR training
• Conducting toolbox talks
• Promoting awareness during National Safety Week and Road Safety Week
• Conducting daily crane inspections
• Implementing effective waste management on-site
• Arranging health checkups for our site staff
• Offering training programs based on specific requirements
• We are committed to ensuring the highest standards of safety, skill development, and overall excellence in our operations.

  7. What are the projects that SML is working on currently?

We are seeing demand across sectors such as thermal power, petrochemical and refineries, oil and gas, steel, cement, windmills, railways, metros, and bridges projects, and for construction applications like erection, heavy lifting, and maintenance services. Demand for cranes is coming from across the country and we have 130 active job sites.

Wind energy Sites: Gujrat, Maharashtra, MP, Tamil Nādu, Karnataka.

Infra Projects – Baruni (BH), Barmer (RJ),

8. What do you see when you buy a new crane or any other equipment? What are the parameters you assess before purchase?

Conducting thorough market research, and consulting industry experts, one can make an informed decision while purchasing futuristic equipment that meets today’s market requirements and offers advanced configurations. Following parameters are important:

• Equipment Specifications:
• Technology and Innovations:
• Efficiency and Productivity
• Safety Features
• Market Research and Future Requirements

9. Where do you see SML in the next five years? Do you have plans to go into the international rental market?

   Initially established with a focus on providing crane rental services, we are diversifying our service offerings by expanding into new growth avenues. In our pursuit of maintaining a competitive edge and delivering exceptional value to our customers, we embarked on a path of transformation, expanding our portfolio to encompass a comprehensive range of services to offer end-to-end solutions that cater to the complex needs of our clients.

   We are strategically evolving into an esteemed engineering solution partner to include engineering, designing, and execution for various infrastructure and core sector projects. Furthermore, we have identified the potential for future growth and are capitalising on it by introducing value-added services such as Wind and Project EPC. These initiatives not only align with market trends but also position us favourably to seize upcoming opportunities.

   Through strategic diversification, enhanced offerings, and the development of allied services, we are well-positioned to meet the evolving needs of the industry and drive sustainable growth. We remain committed to delivering excellence and exceeding the expectations of our valued clients.

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