Setco, the domestic market leader in clutches for commercial vehicles, is geared up for huge growth in the Indian CV sector in the next five years. While the company considers the proposed BS VI emission norms implementation from 2020 as an important opportunity, it also sees the growing presence of global OEMs in the Indian market as a gateway for its global ambitions.
Says Mr. Harish Sheth, CMD, Setco Automotive: “The Government has called for BS VI emission norms from 2020 which will call for bigger engines that will demand bigger and improved clutches. Today, most of the deep mining trucks are imported, and when they get localized, we will have an opportunity for supplying clutches locally. We have almost 90 per cent marketshare in the M&HCV segment and work with all OEMs, so the right thing for us would be to look outside India. Now that our products are well accepted by brands like BharatBenz and MAN, our ability to penetrate the export market will be much better.”
Setco had invested Rs. 180 crores in setting up a foundry facility, not just as a backward integration but also as a move towards quality upgradation. It will be investing another Rs. 100 crores in the facility in the next two years. A couple of years ago, the company had inked a JV with Lingotes Especiales S.A. of Spain to develop and manufacture fully machined ferrous casting products for the automotive and other industries at its Gujarat plant. The Gujarat-based firm plans to focus on consolidating the two new facilities before looking at further expansion. It will not only assist in achieving Setco’s internal requirements, but also leverage existing customer relationships for getting into fully-machined critical component supplies.
Having established itself as the first choice of OEMs in the local market, Setco has made a successful entry into the aftermarket space which it considers one of its focus areas moving forward. In terms of vehicle segments, the company has made a foray into the tractor space and the LCV segment which are tipped to contribute in a big way to its growth in the next three to four years.
“Our target for 2018-19 is to reach a turnover of Rs. 1,000 crores. We are clear of achieving it thanks to our entry into the LCV segment and our impending entry into the tractor market, coupled with the CV segment growth. By 2020, we would grow by another 15%”, states Mr. Sheth.
He signs off by listing Setco’s top three priorities until 2020, namely, competitively-priced quality products backed by superior customer service, strong HR policies and focus on new segments of tractor and export markets.