There is a distinct similarity among companies like Mahindra and Mahindra, Tata Motors (with its CVs), Bajaj Auto, Bharat Forge, Sidwal, Apollo Tyres and so on, even though they are all quite different in their product lines. The only common thread binding them is that all of them have upped their ‘technological’ ante and have been able to withstand any competitive headwinds arising from multinational giants in their respective fields.
One such understated company in the domestic super-application industry is Tratec Engineers Pvt. Ltd., which soldiered on for two decades even after the influx of European heavyweights. Furthermore, the home-grown player commands a sizeable market share in the domestic heavy or over dimensional cargo (ODC) industry. The company’s product portfolio comprises running gears, under carriages for tanker trailers, car transporters, simple mechanical trailers to special purpose customised products for defence and space applications. The Gurgaon-based company is also credited with introducing fully indigenous ‘Hydraulic Modular Trailers’ in the country.
In order to gain an insight about Tratec’s ground-breaking technology, MOTORINDIA caught up with its Founder-cum-Director, Mr. Kamal Khosla, along with his son, Mr. Dhruv Khosla, Manager – Marketing & Purchase, and Ms. Vaishali Narendra, Dy. Manager – Finance.
Mr. Kamal Khosla, who is also one of founders, said: “We are controlling about 80 per cent of the ODC market and are competing with (overseas) firms which are still importing their products here. Apart from being a special trailer manufacturer, we have specialised into heavy fabrication too. We are perhaps the only company in India that is continuously doing pioneering work in the field of ‘Trailer Technology’. The Tratec team is always ahead with a specific innovative or customized transport solution for our client’s special transportation needs but at a reasonable cost, unmatched delivery and personalised service which very few trailer manufacturers in the world could boast of. Nearly 1,000 trailers built by us have already hit the Indian roads.”
He added: “Even though our products are well accepted in the market, we are going a step further by developing next-generation trailers with new configurations and aesthetics. We have a dedicated design and development team working on futuristic products. Mr. Rangaswamy, one of the promoters, is an expert in designing of special systems. We have also developed a trailer which is equipped with the same specifications offered by German companies but at competitive price points. In order to maintain its technical finesse, there are some German components like axles, slew bearings, wheel rims and tyres. So a 6-axle trailer made by us costing about Rs. 84 lakhs will be around half the price quoted by our German competitors. Going forward, we have also developed the technology for electronic steering systems for self-propelled vehicles (SPVs). It is basically a hydraulic steering system controlled electronically. But that is a very niche market.”
Formidable client base
Throughout the course of its two-decade existence, Tratec has managed to bag numerous commercial transport clients like Nabros Transport from Ahmedabad, Agarwal Carriers Corporation of India, ALL Cargo Logistics and J.M. Baxi and Company from Mumbai.
Besides all the big-league transporters and special transporters in the ODC segment, Tratec makes gigantic trailers that are used by capital goods manufacturers / infrastructure projects to move their products. The company specialises in offering total solutions, including design, development, manufacture and maintenance of technologically advanced transportation systems. It has allied itself with a number of firms from the power, infrastructure and other industries such as L&T, Tatas, ISRO, BHEL, and many more. In the defence application business too, a number of PSUs like BEML, BEL, Bharat Dynamics Ltd., etc.
Tratec is also working with the Ministry of Defence (MOD) for a tank transporter and has supplied special-purpose trailers for the transportation of critical equipment of the Nuclear Power Corporation.
“All the sophisticated trailer fabrication for defence PSUs are done by us. We are also associated with the Defence Research Development Organisation (DRDO). We are the only company in India which can make a complete road mobile launcher in-house. In the launch system, we are controlling 50 per cent of the market. The opportunities in other sectors are also immense. The country would be power-deficient for another 15 years. As long as the number of power plants keep mushrooming across the country, (buying of) hydraulic modular trailers will be imperative at least for the next 15 years,” asserted Mr. Khosla.
Major thrust on exports
Apart from establishing its presence in India, the company has started tapping clients in Mexico, Saudi Arabia, Kuwait, Qatar, Bangladesh, Sri Lanka, Pakistan etc. Exports account for five to 10 per cent of its total business.
“We have participated in an exhibition called ‘Powerlift Asia’ in Singapore last year to widen our export horizons. Our overseas clients are in Sri Lanka, Bangladesh, Saudi Arabia, Mexico, Qatar and the Philippines. Going forward, we plan to focus on East Africa, South Africa and South-East Asia and are also trying to tap the Pakistani market,” shared Mr. Dhruv Khosla.
Tratec has its huge association with Volvo’s 5 and 6 series of ‘Prime Movers’. It is also in touch with MAN and Scania and is ready to ally with them whenever there is an opportunity. However, its association with Volvo will still account for 80 per cent of the ODC market.
Asked about the manufacturing capacity, the senior Khosla indicated that in the case of modular trailers the capacity is measured in terms of the number of axle lines, starting with a capacity of about 24 axle lines a year in standard configurations of 2, 4 and 6 line modules, Tratec has the manufacturing capacity of 100 axles per month which can be ramped up to 300 axles subject to market conditions.
As far as its organic plans are concerned, the company has already invested Rs. 45 crores at its new plant at Bawal, Haryana, which is employing around 100 people, and roughly Rs. 5 crores for upgradation of the existing plant at Bhondsi in Gurgaon employing around 250 people.
Decades of experience
Tratec was started about 20 years back, during 1995-96, and was promoted by three people who had a background in a similar industry. Mr. Raman Anand, one of the founders, sold his stake to Mr. Anil Narendra in April 2012 and henceforth his daughter has been roped in to look after the financial operations of the business.
Mr. Kamal Khosla said: “I was with Mahindra and Mahindra (trailer-making arm) before venturing into this business. At that time, most of the trailers used for super-heavy applications were being imported at an exorbitant cost. We identified an opportunity in this business and developed a fully indigenous solution which was functionally comparable to European products at a substantially lower cost. We specialised ourselves in the special transportation category and grew our business there. Of late, we have been diverting our focus from the civilian segment to the defence segment. We control about 90 per cent of the market (in India) in the trailer segment for defence forces.”
Even though the company is fighting a tough battle with unorganised players by churning out standard trailers, it has ruled out any plans to sell such products. “In the last four decades, our country got used to standard mechanical trailers. With the customer taste evolving, they (unorganised players) will fade away sooner or later. Having said that, our products can be a bit more affordable if the sales tax structure (on trailers) is worked upon. Our industry will get a massive boost because a recognised firm like us can produce high-quality trailers at a reasonable cost (due to reduced sales tax). Then we can also come up with standard trailers which are high-on-value. If the price differential (between low-end and high trailers) can be reduced, it will be a great help for the nation as a whole. At this juncture, the unorganised players get away by not paying any taxes, and we shell out huge sums of excise duty and sales tax. Additionally, the Government should also build more highways and roads to boost the transportation industry in India. As a corollary, we can have excellent transport with trailers in the country,” observed Mr. Kamal Khosla.
ODC industry evolution
The ODC industry was growing by over 20 per cent over the last ten years. It has hit a soft landing a couple of years back as the Central Government could not take any decision in the Capex sectors. Because of the ongoing recessionary trends, the market size of trailers nosedived from 200 axles per month to 25 axles per month which is worth Rs. 15 crores.
“With the new government at the helm of affairs, we expect a faster decision on the infrastructure sector. And we expect the market to grow at about 20 to 25 per cent before stabilising in the initial phase. If the government starts taking decisions on a quicker basis, I think our industry can grow by 20 to 25 per cent,” asserted Mr. Khosla.
From Rs. 30 crores clocked in the last financial year, Tratec is looking to double that figure by the end of FY 2014-15 and re-earn Rs. 100 crores (turnover for FY 2011-12) in the next fiscal. “We want to produce self-propelled modular trailers (SPMT) and intend to provide state-of-the-art solutions for the defence and transportation sectors. We also intend to provide affordable transportation solution. Right now we are concentrating on up to 500 tonnes and, going forward, up to, say 2,000 tonnes,” signed off Mr. Kamal Khosla.