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EPC concept could be the future when it comes to retrofit projects

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Manoj Thakur Head – Mechanical, Penta India Cement and Minerals.

We at Penta would like to participate in the growth of our clients in cement plants by picking the right and most effective solutions for them, assures Manoj Thakur, Head – Mechanical, Penta India Cement and Minerals. Excerpts from the interview…

How important is predictive maintenance?
In the past few years, capacity utilisation of cement plants have been low in the range of 60-70 per cent. As a result, the machinery was not stressed to its maximum potential and plants also got more time to take care of breakdowns. It is expected that with the Government of India providing enough scope in infrastructure development, there will be a rise in demand. Once cement plants are pushed to achieve 90-100 per cent of their design capacities, there will be no more cushion available for unexpected breakdowns or shutdowns. This is when predictive maintenance will start playing an important role.

Indian cement industry has realised that implementing the predictive maintenance leads to a substantial increase in productivity. Concept of online monitoring is well understood and accepted by cement manufacturers wherein the state of health of a machine is known before taking it for the maintenance. In recent years, many examples of predictive maintenance have been seen, for example, many existing storage silos and structures have been taken for additional strengthening based on the results from non-destructive tests, process fans have been taken for balancing on the results from vibration monitoring tests etc. Not only major players but even medium players use regular services of consultants for carrying out predictive maintenance.

What are the challenges in retrofitting a cement plant?
The most critical challenge is that cement plant retrofits are expected to be carried out without affecting the production. In consequence, the cement players prefer technologies that require the least downtime. However, there are very few contracting agencies to take up such challenges. Another challenge is the plant layout. Many old plants were designed with no provision for the future expansion and thus retrofit projects could not be carried out. At some plants, projects were executed at huge costs for layout reasons. Though Indian cement industry is very traditional, EPC concept could be the future of it when comes to retrofit projects, keeping the existing plant in operation or with very minimum time required for the interface. Keeping pace with newer and compact technologies is essential to accommodate retrofit projects in poor layouts. This is where smart engineering comes to play.

Consulting firms like Penta excel in these niche areas and have the expertise to work out customised solutions for cement plants.

How does one decide between retrofitting and switching completely to a new system?
Penta usually assesses the potential of an existing old plant for the possibility of capacity increase before suggesting retrofit solutions. For capacity increases on a larger scale, letGC?s say doubling the plan capacity, switching to a complete new system becomes necessary. However, execution of a new cement plant has a long gestation period right from the day of conception.

There are various reasons in India taking too much time for pre-project activities including approval and procurement of land, acquisition of mines, access to coal reserves, environmental clearances, etc. Once these pre-project requirements have been met, project-related activities take their routine pace to accomplish the job. Retrofit solutions are sometimes seen as the compromise in these difficult situations.

Which type of retrofit can have greater impact on production efficiency?
Each type of retrofit, whether enhancing production efficiency, electrical, mechanical or monitoring and automation, has its respective justifications and goals. It would be unfair to compare them as they are apples and oranges. Of course, it ultimately results in improving the plant availability. Moreover, upgradation in the mechanical domain may have to combine with a retrofit in electrical and automation domain. To choose, it greatly depends on the condition and requirement of different areas i.e., mechanical, electrical and control and automation.

To achieve the benefit of a retrofit in totality, it needs to be the combination of all. A mechanical retrofit alone cannot enhance the production efficiency if existing motor control bucket, panel board or switchgear are of older designs. Likewise, retrofit for monitoring and automation are inadequate if existing machinery/equipment do not keep margin for the increased outputs. Hence, it could be advisable not to implement short-term solutions in one domain without exploring the implications in another.

How does one keep pace with the advancements in sub-systems like automation?
Cement manufacturers need to assess the need of such upgrades with a close look at their current plant availability. A balance can be achieved with regular maintenance schedules for existing equipment and opting for necessary automation upgrades. World-class suppliers develop and come up with newer technologies in automation year after year. Automation upgrades certainly help in improving the plant efficiency by various automated solutions. However, the selection of upgrades should be need based and in keeping with the capabilities of the hardware as well as the skill level of the plant personnel.

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Concrete

Construction Costs Rise 11% in 2024, Driven by Labour Expenses

Cement Prices Decline 15%, But Labour Costs Surge by 25%

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The cost of construction in India increased by 11% over the past year, primarily driven by a 25% rise in labour expenses, according to Colliers India. While prices of key materials like cement dropped by 15% and steel saw a marginal 1% decrease, the surge in labour costs stretched construction budgets across sectors.

“Labour, which constitutes over a quarter of construction costs, has seen significant inflation due to the demand for skilled workers and associated training and compliance costs,” said Badal Yagnik, CEO of Colliers India.

The residential segment experienced the sharpest cost escalation due to a growing focus on quality construction and demand for gated communities. Meanwhile, commercial and industrial real estate remained resilient, with 37 million square feet of office space and 22 million square feet of warehousing space completed in the first nine months of 2024.

“Despite rising costs, investments in automation and training are helping developers address manpower challenges and streamline project timelines,” said Vimal Nadar, senior director at Colliers India.

With labour costs continuing to influence overall construction expenses, developers are exploring strategies to optimize operations and mitigate rising costs.

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Concrete

Swiss Steel to Cut 800 Jobs

Job cuts due to weak demand

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Swiss Steel has announced plans to cut 800 jobs as part of a restructuring effort, triggered by weak demand in the global steel market. The company, a major player in the European steel industry, cited an ongoing slowdown in demand as the primary reason behind the workforce reduction. These job cuts are expected to impact various departments across its operations, including production and administrative functions.

The steel industry has been facing significant challenges due to reduced demand from key sectors such as construction and automotive manufacturing. Additionally, the broader economic slowdown in Europe, coupled with rising energy costs, has further strained the profitability of steel producers like Swiss Steel. In response to these conditions, the company has decided to streamline its operations to ensure long-term sustainability.

Swiss Steel’s decision to cut jobs is part of a broader trend in the steel industry, where companies are adjusting to volatile market conditions. The move is aimed at reducing operational costs and improving efficiency, but it highlights the continuing pressures faced by the manufacturing sector amid uncertain global economic conditions.

The layoffs are expected to occur across Swiss Steel’s production facilities and corporate offices, as the company focuses on consolidating its workforce. Despite these cuts, Swiss Steel plans to continue its efforts to innovate and adapt to market demands, with an emphasis on high-value, specialty steel products.

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Concrete

UltraTech Cement to raise Rs 3,000 crore via NCDs to boost financial flexibility

UltraTech reported a 36% year-on-year (YoY) decline in net profit, dropping to Rs 825 crore

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UltraTech Cement, the Aditya Birla Group’s flagship company, has announced plans to raise up to Rs 3,000 crore through the private placement of non-convertible debentures (NCDs) in one or more tranches. The move aims to strengthen the company’s financial position amid increasing competition in the cement sector.

UltraTech’s finance committee has approved the issuance of rupee-denominated, unsecured, redeemable, and listed NCDs. The company has experienced strong stock performance, with its share price rising 22% over the past year, boosting its market capitalization to approximately Rs 3.1 lakh crore.

For Q2 FY2025, UltraTech reported a 36% year-on-year (YoY) decline in net profit, dropping to Rs 825 crore, below analyst expectations. Revenue for the quarter also fell 2% YoY to Rs 15,635 crore, and EBITDA margins contracted by 300 basis points. Despite this, the company saw a 3% increase in domestic sales volume, supported by lower energy costs.

In a strategic move, UltraTech invested Rs 3,954 crore for a 32.7% equity stake in India Cements, further solidifying its position in South India. UltraTech holds an 11% market share in the region, while competitor Adani holds 6%. UltraTech also secured $500 million through a sustainability-linked loan, underscoring its focus on sustainable growth driven by infrastructure and housing demand.

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