Over the last 18 years, Nuvoco Vistas Corp has emerged as one of the major players in India through various greenfield and brownfield projects. The company’s plants in Chhattisgarh, Haryana, Jharkhand, Rajasthan and West Bengal account for an installed cement capacity of 10.92 mtpa. The company also has a pan-India presence in the ready-mix concrete business, with close to 70 plants across the country. Its aggregates business is based in north India with a capacity of 170 tonne per hour. What’s more, to undertake R&D activities to develop innovative solutions specific to unique requirements, the company established its Construction Development and Innovation Centre (CDIC) in Mumbai in early 2012. The centre endeavours to bring solutions closer to the market, accelerate the process and build up locally through systems development.
While Pranav Desai, VP – Research & Head CDIC, Nuvoco Vistas Corp, along with his team, recently took the ICR team on a detailed tour at CDIC, spread across 17,000 sq ft, to explain its working and activities, Madhumita Basu, Chief of Marketing, Innovation, Strategy and IT, Nuvoco Vistas Corp, shared insights about the company and its future plans in conversation with BS Srinivasalu Reddy of ICR.
CDIC clearly speaks of the company’s focus on R&D. Tell us about the company’s investment in this area.
We are not really chasing a particular percentage of the turnover. It is not about being among the top five research companies and investing a certain part of the business into this. Our focus is on building a robust agenda for the centre.
Concrete is a finished product, and being in the construction space, the genesis of CDIC has largely been the concrete space. So, the centre does not only look at just the material side of it, but the placement and finishing, and ensuring it is an end-to-end solution. Our spends are currently around 0.5 per cent and will be further driven as customers show keenness to work with innovative ideas and materials. The customer or his need is the initial point for our innovation. The centre has brought unique solutions like Duraguard Microfiber cement, light weight concrete, concrete of various strengths, including for metro projects, light emitting road pavers, etc. CDIC has also recently received NABL accreditation.
While the company supplies to projects pan-India, it has only one CDIC centre based in Mumbai. Does this pose a challenge?
The nuances are different in every place in India. Infrastructure projects are crucial today; yet 65 per cent of cement goes into Individual Home Builder (IHB) operations. Certainly, in our blueprint, in the next two years, we are looking at a satellite to this centre out of our concrete plants. Having received clearance for two, we are trying to push for another centre as well. So we are working around two centres between Delhi, Chennai and Kolkata this year. We need to operate closer to the customer and this will help in quick sampling, leading to a better interface with the manufacturing team. Also, at times, there has been a fair bit of delay between the concept of an idea and speed to market. The satellites would help address this issue.
Which building or infrastructure segment contributes maximum to your business?
A large bit of it is our cement footprint where again our focus is on the individual home builder. So that is a space which afforded an early opportunity to go with differentiated products. First with Concerto -a premium cement product. It is definitely the strongest cement, but the factors we work on in our cement design include the kind of workability and finish it can give. How will the mason working with the product be able to handle it because they have a tendency to make a batch and you do not always have a very scientific process there. The third feature of this product is finished whiteness. This is after understanding that consumers many times when they build their homes do not like to paint and finish together, they wait and see one monsoon if construction is okay, then I will conduct repairs and then I will go for painting and finishing. But if I give him cement which gives him a glow and good even finish along with good workability, so it helps. So this engagement with the consumer is the same principle today we are taking to World One or the hanging swimming pool as well. Like what was your need and then I have this basket, how can I fit it in.
What was your contribution to World One project?
The world’s tallest residential building, World One is 442 meters (m) tall, with a floor area of 1,50,000 square meters (sq m), 117 floors, and over 300 apartments. The construction of such a staggering structure was incredibly challenging, owing to potentially extreme wind resistance and wear and tear of its massive sub structure and slender super structures. Nuvoco conducted extensive research and testing of locally available raw materials and design mixed methodology, to create a unique high performance concrete (HPC) with a grade of C95-M125 and an MOE (Modulus of Elasticity) of 48-52 Gpa. Not only did it offer minimal shrinkage, creep, vertical pumping above 400 m, and high compressive strength above 100 MPa, but also provided the structure with increased tensile strength and better durability, including resistance to wear and tear, making the project a success.
Is bagged concrete a unique product where you have advantage or others have started bagging as well?
They have started now. But bagged concrete the entire design concept in fact it is probably a case example of the customer discovery process. The discovery deep dive was done in the Dharavi area and the conceptualisation was done to service markets where easy accessibility for not just a concrete mixer but to do site mixing without affecting the lives of neighbours. So, bagged concrete actually has figured as a solution there. But once you get into a solution you do not limit it. In Elephanta Caves, they wanted to do some construction. Obviously they zeroed in on our bagged concrete. So that is how acceptability and other utilities of the product emerge. But we started this entire process and we have the largest range in bags in terms of concrete, micro concrete and we are just launching mortar into the market.
Geographically, where does your strength lie in terms of sales?
Our concrete business is strong in the south and west. In the north and east, we are strong cement players. We service Madhya Pradesh and a part of Uttar Pradesh between our north and west plants. So we have a strong presence between the two businesses. There is definitely a leveraging base in the east and north for the concrete business. We are looking at some more home builder-specific solutions, for which we have started an engagement with our cement channel partners, particularly because we have the concrete range in bags. We have already kick-started this process in the east.
How many channel partners do you have?
Including the dealers and retailers we have in our northern, central and eastern footprint, there are about 18,000 to 19,000 channel partners. We continuously run engagements with them, such as loyalty-driven programmes and several other activities.
How do you see 2019 panning out for your company in terms of growth?
Cement and concrete mirror the same consistent growth rate, which has been consistent on a year-on-year basis at 6-7 per cent. At the micro-market level, there have been localised issues like that related to the sand mining ban in States such as Jharkhand, Bihar and Bengal; but some of these are correctional issues also that would be faced by any growing economy. In fact, I would see a little disruption in the first one or two quarters for two reasons one is the election process and then 45 days before cooling period will kick in. And by the time the budgets are out we will hit monsoons and the low construction activity. Markets in H2 will re-bound with encouraging growth figures expected at 9 to 11 per cent.