After a downturn triggered by COVID-19, things are perking up for industries, especially for those in the infra space. Kone Elevators India sounds upbeat about its growth in the backdrop of factors such as pent-up demand, liquidity and real estate showing signs of pick up
Amit Gossain, MD, Kone Elevators India, says the realty sector contributes about 13 percent to the GDP of India, which is eyeing the $1 trillion mark by 2030.
“We are driven by consumers. We notice the residential segment is moving fast as there is pent-up demand. Affordable housing also has been given a lot of thrusts. After a sluggish start in January, the realty business, especially residential, has been showing positive signs. The commercial sector has not yet reached its peak,” he said, welcoming the emphasis companies are now placing on having employees back to work physically.
Steering the Finnish major’s operations in India, Gossain says the stress on productivity and the work from home scenario giving way to physical presence augurs well for the elevator and escalator sector. “Residential has not only picked up but we find that more digitalization has happened. Also, with payments and orders or marketing functions too getting digitalized across industries, the scope for leveraging digital is enormous,” he adds.
Kone for one has been upping its technology backbone. It has IoT-based services tech centers in Chennai and Pune where the monitoring is done. “We also customize elevators based on needs like providing music or adjusting the temperature or displaying weather status,” Gossain says, noting that the company also designs Vaastu-compliant elevators and it offers 35 such designs to suit the customer preferences.
“Interestingly, stainless steel elevators are gaining more traction and there is a trend to opt for painted ones – like gold instead of dual colors.”
The elevators and escalators market pegged at around 55,000, suffered a 30 percent hit due to the pandemic. But now with a semblance of normalcy, the recovery has been cut to 10 percent.
When the commodity prices of cement, steel skyrocketed, Kone and others in the business had raised the prices. “While we were able to absorb a certain part of the surge, across the industry we saw the prices going up by7-8 percent,” he says, adding that the Rs 10 lakh to Rs 25 lakh band of elevators were fast-moving.
Kone’s pole position is still intact though it is keen to expand its market share. “We see there are 5-6 big players in South East Asia. A major portion (60 percent) of our business is from residential while 20 to 25 percent comes from commercial and the balance is through retail,” Gossain says, observing that the market for connected lifts has gone up especially since the price differential is only an extra Rs 25,000.
Kone has 1,000 plus engineers in Chennai and another1,200-odd at its Pune center. Though elevators are no longer seen as a “luxury,” Gossain is skeptical about government tenders. “The process must be more balanced. We are dealing with hi-specs elevators where there can be no compromise on quality. The formula for awarding tenders must be revisited,” says Gossain, who claims 75-80 pc of Kone’s business is due to repeat customers. “We don’t sub-contract maintenance,” he points out.
